As the March 15 corporate tax filing deadline approaches, California’s small businesses need to know they may qualify for an important health care tax credit available under the Affordable Care Act.

The Small Business Health Care Tax Credit provides a credit equaling up to 35 percent of the health insurance premium costs that a small business incurred for insuring its employees. The credit is designed to help small businesses and tax-exempt organizations that primarily employ moderate and lower-income workers either maintain existing coverage or offer health insurance to their employees for the first time.

Certified Public Account and tax expert Conrad Davis, Crowe Horwath LLP, explains that more businesses need to be made aware of this benefit of the law aimed at small employers.

“Right now the credit is underutilized,” Davis said in an interview with CalChamber News. “The studies show that not as many businesses that are eligible are participating.”

According to a recent study, more than 375,000 small businesses in California are eligible for health insurance tax credits for a total value of more than $1.8 billion.

Small employers that pay at least half of the premium for employee health insurance coverage may be eligible for the Small Business Health Care Tax Credit, according to the Internal Revenue Service (IRS).

CalChamber News has the full story, including more details on which employers qualify for the tax credit.

Author: Gail Cecchettini Whaley

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