For entrepreneurs considering forming a company, the newly passed healthcare reform could affect small businesses – or it may not. ZaneBenefits.com offers some insight on which SMBs will be impacted by the new legislation.
To start, the source says that companies with fewer than 25 employees and average salaries less than $50,000 are eligible for a small business health tax credit. This credit will help small businesses cover full-time employees’ health insurance costs.
ZaneBenefits.com says the number of full-time, eligible employees for coverage can be calculated by adding the number of staff who work 40 hours or more per week with the number of full-time-equivalent employees. The number of full-time-equivalent employees is determined by adding the hours worked by part-time staff and dividing it by 2,080.
Notably, the source says SMBs are not required to offer health insurance under the new legislation. There are no penalties for companies with fewer than 50 employees who do not offer health insurance. However, as of January 1, 2014, all individuals must buy health insurance and the government will help subsidize coverage for eligible workers.
The IRS recently mailed out information about tax credits to more than 400 eligible small businesses, reports Time. This new tax benefit is one of many offered to entrepreneurs who undergo business formation.