See if You Qualify for the Small Business Health Care Tax Credit

Small Business Health Care Tax Credit

Floridian Quote is one of the premier health insurance consultant companies with expertise in both group and individual health insurance plans. Floridian Quote can offer a wide range of health insurance company plans and pricing.

Clients have an opportunity to choose the best plan that matches with their business or personal requirements and fits their budget. Floridian Quote works with clients in Miami, Orlando, Tampa, Jacksonville, Florida, and surrounding locations.

Qualifying Criteria for Tax Credit

As a small business employer, you can qualify for health care tax credits if you have fewer than 25 full-time equivalent (FTE) employees earning an average salary of up to $50,000 per year. All of the following criteria must be fulfilled in order to qualify for the Small Business Health Care Tax Credit:

  • The total number of FTEs in your firm is less than 25
  • The average annual salary of an employee is up to $50,000
  • You pay 50 percent or more of the FTE’s premium costs
  • You provide coverage to your FTEs via the SHOP Marketplace
  • The value of tax credit is up to 50 percent of your contribution toward your FTE’s premium costs (up to 35 percent for tax exempt employers)

Additional Noteworthy Aspects

To determine whether your organization qualifies for small business health care tax credit, you should also account for the following points:

  • It is not necessary to offer coverage to your part time employees (who work fewer than 30 hours per week) or to dependents in order to qualify for the tax credit.
  • Irrespective of size, every employer that provides self-insured health coverage to employees is required to file an annual return reporting certain details for each employee they may cover.
  • Certain affiliated employers with common ownership or those who are part of a controlled group will be required to aggregate their employees to determine their workforce size.

Floridian Quote serves clients in Miami, Orlando, Tampa, Jacksonville, Florida, and nearby areas.

Bigger Credit for Smaller Businesses

Companies with fewer than 10 employees who receive an average salary of less than $25,000 will be eligible for the highest tax credit. The smaller the size of the business, the bigger will be the share of credit.

An Illustration of How Tax Credit Works

  • Number of employees: 8
  • Wages: $20,000 per employee on average: $160,000 total
  • Employer contribution to premiums: $50,000
  • Tax credit amount: $25,000 (50% of employer’s contribution)

Frequently Asked Questions

How do I know if I am a small or large employer? Why does it matter?

The size of an employer is determined by the number of its employees. In general, an employer with 50 or more FTEs will be considered a large employer. Employer benefits and requires are contingent upon employer size and the applicable rules.

Do I have to buy my coverage through the SHOP Marketplace to claim the tax credit?

Yes, the only way to qualify for the Small Business Health Care Tax Credit is by using the SHOP Marketplace. But you can buy coverage for your employees in multiple ways.

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We are health insurance consultants | agents with many years of experience in the health insurance field and access to multiple health insurance company’s plans and pricing. We will work with each you to find the right group or individual health insurance plan to fit your needs and budget. Serving clients in and around Greater Jacksonville, Orlando, Tampa, Miami, Florida and more. Contact us at 866-217-2873.