The Affordable Care Act (Obamacare): If You Do Not Have Health insurance (Uninsu

Tax Credit: 2010 - 2014: The Act provides a tax credit to small employers with no more than 25 employees and average annual wages of less than $50,000 that purchase health insurance for employees.

• Phase 1: For tax years 2010 through 2013:
  • A tax credit of up to 35% of the employer's contribution toward an employee's health insurance premium if the employer contributes at least 50% of the total premium cost or 50% of a benchmark premium.
  • The full credit will be available to employers with 10 or fewer employees and average annual wages of less than $25,000.
  • The credit phases-out as firm size and average wage increases.
  • Tax-exempt small businesses meeting these requirements are eligible for tax credits of up to 25% of the employer's contribution toward the employee's health insurance premium.
  • For a complete understanding of the law, click here.
• Phase II: For tax years 2014 and later:
  • For eligible small businesses that purchase coverage through an Exchange, a tax credit of up to 50% of the employer's contribution toward an employee's health insurance premium if the employer contributes at least 50% of the total premium cost.
  • The credit will be available for two years.
  • The full credit will be available to employers with 10 or fewer employees and average annual wages of less than $25,000.
  • The credit phases-out as firm size and average wage increases.
  • Tax-exempt small businesses meeting these requirements are eligible for tax credits of up to 35% of the employer's contribution toward the employee's health insurance premium.

Wellness: The Act provides grants for up to 5 years to small employers that establish wellness programs. Funds have been appropriated beginning in fiscal 2011.

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