Small Business Health Care Tax Credit Form Released

The IRS has released Form 8941, Credit for Small Employer Health Insurance Premiums, and related instructions, for tax year 2017. Eligible small employers use this form to figure the credit for health insurance premiums under the Small Business Health Care Tax Credit.

The Small Business Health Care Tax Credit is designed to encourage small businesses and tax-exempt employers to offer health insurance coverage to their employees. Among other requirements, an employer may be eligible for the credit for tax year 2017 if:

  • It had fewer than 25 full-time equivalent employees for the tax year;
  • It paid at least 50% of the premium cost for single health care coverage for each employee.
  • The average annual wages of its employees for the year were less than $53,000; and
  • It paid premiums on behalf of employees enrolled in a qualified health plan offered through a Small Business Health Options Program (SHOP) Marketplace (or qualifies for an exception to this requirement).

Note: Employers in Hawaii cannot claim this credit for insurance premiums paid for health plan years beginning after 2016.

Click here to review Form 8941 and its instructions.


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