Today, the Obama Administration issued new information that will help small businesses take advantage of new tax credits to reduce the cost of providing health coverage to their workers. The new information includes a full set of tools and documents small businesses can use to claim the credit this year, and also clarifies that a broad range of small employers, including religious institutions, can qualify.
These tax credits are just one part of President Obama’s work to strengthen small businesses across the country. In fact, the President has cut taxes for small businesses 16 times -- accelerating more than $55 billion in tax relief over the next year to businesses across the country.
Small businesses pay 18 percent more for health insurance premiums than large businesses. The Affordable Care Act changes that by providing tax credits for small businesses that offer employees health insurance and by leveling the playing field with larger employers. Up to 4 million small businesses could be eligible for relief from high health insurance premiums this year, and, according to the independent Congressional Budget Office, the tax credit will save small businesses $40 billion by 2019. Many small businesses are already benefitting from the new tax credits today:
The tax credits are just one of the ways the health reform law will help small businesses. The law will also helps level the playing field with large employers by allowing small businesses to band together to get a fairer deal from insurance companies through the creation of competitive private health insurance markets called Exchanges that go into effect in 2014. Exchanges help organize the health insurance marketplace to help consumers and small businesses shop for coverage in a way that permits easy comparison of available plan options based on price, benefits and services, and quality. Pooling people together can help bring costs down and Exchanges will make our health care system more transparent and competitive by making it easier for consumers to compare costs and benefits.
Small businesses are the engine of our economy and President Obama and his team will continue to do all we can to help small businesses grow and succeed.
Stephanie Cutter is Assistant to the President for Special Projects