Claiming the Small Business Health Care Tax Credit

Tax season is underway, and you may qualify for savings. Small group employers who offered SHOP insurance in 2017 may be eligible for the Small Business Health Care Tax Credit, which can help to offset the cost of health insurance premiums. How will the Small Business Health Care Tax Credit make a difference for you?                 The maximum tax credit is 50% of premiums paid for small business employers and 35% of premiums paid for small, tax-exempt employers. The tax credit is available to eligible employers for two consecutive taxable years. The amount of the credit you receive works on a sliding scale – the smaller the employer, the bigger the credit. If you are a small business employer, you may be able to carry the credit back or forward. If you are a small, tax-exempt employer, you may be eligible for a refundable credit. Claiming the Small Business Health Care Tax Credit You must use Form 8941, “Credit for Small Employer Health Insurance Premiums,” to calculate the credit. If you’re a small business, include the amount as part of the general business credit on your income tax return. If you’re a tax-exempt organization, include the amount on line 44f of the Form 990-T, “Exempt Organization Business Income Tax Return.” You must file the Form 990-T to claim the credit, even if you don't ordinarily do so. Questions? Contact the SHOP Call Center at 1-800-706-7893 (TTY: 711) weekdays from 9 a.m. to 7 p.m. Eastern Time. Additionally, the Internal Revenue Service has more information about the Small Business Health Care Tax Credit. Please be aware that the SHOP Call Center hours will change on March 28, 2018. It will be open weekdays from 9 a.m. to 5 p.m. Eastern Time.   Thank you, The SHOP Team