Most small business qualifies for health care tax creditAccording to a new report, the majority of small businesses in Wisconsin are eligible for a tax credit under the new health care reform law.
By: Kristen Durst, Wisconsin Public Radio, Superior Telegram
According to a new report, the majority of small businesses in Wisconsin are eligible for a tax credit under the new health care reform law.
John Erensmeyer is the CEO of Small Business Majority. It co-authored a recent small business health care tax credit eligibility study with the non-profit Families USA. He says it's the bottom line that keeps many small businesses from offering health insurance to their employees. Erensmeyer says "86 percent of small businesses who don't offer coverage say that it's because of costs, of those who are offering coverage 72 percent say they're struggling to afford it. So clearly cost is the first, second, and third concern of small businesses when it comes to health care."
The report studied eligibility requirements under the new health care law and found that over 86,000 small businesses in Wisconsin qualify to receive deductions under the new law this year. That's more than 86 percent of small businesses in the state.
According to the new law, eligible small businesses can now receive a tax credit of up to 35 percent of the cost to provide coverage. The study found that almost 26,000 Wisconsin businesses quality for the maximum credit. In 2014, eligible small businesses will receive a tax credit for up to 50 percent of the cost of coverage.
To qualify, a small business must have less than the equivalent of 25 full-time workers with average annual wages below $50,000, and they must pay at least 50 percent of their workers’ health care coverage.