Small Business Health Care Tax Credit: Four Cases
Here is a look at how four hypothetical businesses might benefit from the Small Business Health Care Tax Credit that becomes effectively immediately under health care reform.
Example 1: Main Street Mechanic - Auto Repair Shop with 10 Employees
- Employees: 10
- Wages: $250,000 or $25,000 per worker
- Employer Health Care Costs: $70,000
2010 Tax Credit: $24,500 (35% credit)
2014 Tax Credit: $40,000 (50% credit)
Example 2: Downtown Diner - Restaurant with 40 Part-Time Employees
- Employees: 40 half-time (equivalent of 20 full-time)
- Wages: $500,000 or $25,000 per full-time equivalent worker
- Employer Health Care Costs: $240,000
2010 Tax Credit: $28,000 (35% credit with phase-out)
2014 Tax Credit: $40,000 (50% credit with phase-out)
Example 3: 1st Street Family Services - Foster Care Non-Profit with 9 Employees
- Employees: 9
- Wages: $198,000 or $22,000 per worker
- Employer Health Care Costs: $72,000
2010 Tax Credit: $18,000 (25% credit)
2014 Tax Credit: $25,200 (35% credit)
Example 4: Acme Air Conditioning, LLC- Manufacturing Company with 12 Employees
- Employees: 12
- Wages: $420,000 or $35,000 per full-time equivalent worker
- Employer Health Care Costs: $90,000
2010 Tax Credit: $14,700 (35% credit with phase-out)
2014 Tax Credit: $21,000 (50% credit with phase-out)
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