Jackson Hewitt(R) Reminds Small Business Owners to Take Advantage of New Tax Credit for Employee Health Care
PARSIPPANY, N.J. // PRNewswire-FirstCall // -- Thanks to a new tax credit, qualifying small business owners can now reap tax benefits for providing health care to eligible employees. The Small Business Health Care Tax Credit is part of the Patient Protection and Affordable Care Act (Health Care Act) signed into law by President Obama on March 23, 2010. Starting with the 2010 tax year, employers that meet certain requirements are eligible for a nonrefundable tax credit of up to 35 percent of the qualifying costs of an employee's health insurance.
"At a time when health care is being reconsidered from every angle, the government has stepped in to offer small businesses and small tax-exempt organizations a significant tax incentive to pay for at least 50 percent of the cost of health insurance coverage for each of their employees enrolled in company's plan," said Mark Steber, chief tax officer, Jackson Hewitt Tax Service Inc. "For companies that qualify, the tax benefit can be a tremendous break."
Jackson Hewitt Tax Service® reminds small business owners to invest the time now to determine whether they may be eligible for this significant credit. To qualify, employers must have less than 25 full-time equivalent employees and must pay at least 50 percent of the cost of health coverage for each enrolled employee. The average salary for employees must also be less than $50,000 annually. Employers with no more than 10 employees and an average annual salary between $25,000 and $50,000 per employee will receive the highest percentage of credit.
For tax years beginning 2010 and through 2013, the maximum credit for a qualified small business is 35 percent of the qualified premium payments made by an employer. Tax-exempt qualified employers may be eligible for up to 25 percent of the premium payment after reduction for any Medicare taxes paid.
"The IRS has provided a helpful online worksheet to determine if your small business or tax-exempt organization qualifies for the credit," noted Steber. "The credit has a provision that allows any unused credit amount to be applied to all previous years the credit was available or carried to future years until the credit is used."
About Jackson Hewitt Tax Service Inc.
Jackson Hewitt Tax Service Inc. (NYSE: JTX), with more than 6,300 franchised and company-owned offices throughout the United States, is an industry leader providing full service individual federal and state income tax return preparation. Most offices are independently owned and operated. The company is based in Parsippany, New Jersey.
SOURCE Jackson Hewitt Tax Service Inc.