Health Net, Inc. (NYSE:HNT) wants to remind small business owners about one of the first provisions of the recently passed health care reform legislation, the Patient Protection and Affordable Care Act, to go into effect -- the small business health care tax credit.
This tax credit encourages small business owners to offer health insurance coverage for the first time or maintain the coverage they already have. With the potential of assisting four million employers, it is specifically targeted to small businesses and tax-exempt organizations that primarily employ low and moderate income workers.
The tax credit is available to eligible small employers that pay at least half the premium cost of single coverage for their employees in 2010 and employ no more than 25 full-time equivalent employees that have average annual wages of less than $50,000.
This tax credit can be considerable for a qualifying small business. In 2010, the maximum credit is 35 percent of employer-paid premiums (25 percent for tax-exempt organizations). In 2014, the maximum increases to 50 percent of employer-paid premiums (35 percent for tax-exempt organizations).