There are a lot of ways on how to achieve a tax credit and one of these many ways is by paying at least half of the amount of health premiums of every employee if you are either an owner of a business or an employer. Taking advantage of this type of tax credit could not only save money but also maintain a profit for the business during tougher economic times as stated by the Top Tax Defender.
According to the IRS, this credit applies to 2010 tax returns. If the business has not been able to benefit in this credit, they could still have the chance to claim its benefits. Furthermore, the business who already started to make health plans for its employees in 2010 but were unable to qualify for the credit of that same year may be eligible to take the credit in 2011. The tax credit can be benefited in 2013.
The eligibility of the tax credit depends on the amount the employer paid for their employees’ health insurance. That’s why businesses should set up a health insurance as early as 2010 to garner a much larger amount eligible to the tax credit. Employers are eligible to 35% of the amount they paid on employees’ health insurance since 2010. The maximum credit will be increasing to 50% in 2014. Tax-exempt organization can also avail of these credits, although they are eligible only for 25% of the amount paid until 2013 and 35% starting 2014.
Businesses either small or big should be aware of the different tax credits and the importance of knowing your rights and privileges. Like the Health Care Tax Credit, the employer can also offer health insurance benefits to their employees when they can’t afford to do so in the past. This is a nice situation for both the employer and it’s employees, for they can both benefit in this.