Across the country, small businesses are talking to their accountants about a hefty tax credit that could make health insurance a little more affordable.
Six months after sweeping health care reform was enacted, the cost of health insurance remains one of the most pressing issues facing small businesses. Premiums typically run 18% higher for small businesses than for larger companies.
The health care law called for the expansion of state-run exchanges aimed at helping small businesses find affordable coverage. But not until 2014. To bridge the gap, the law also established a slew of significant tax credits to small firms starting this year.
The Internal Revenue Service has sent out millions of post cards to business owners and tax professionals alerting them to the tax credit. Business owners are still working to get their heads around the details, but it's a bit of bright news for those who'll qualify.
"That would be fantastic," said John Wilson, owner of Artistic Kitchens and Baths, a cabinetry and interior design business in Southern Pines, N.C. Wilson pays 80% of the cost of insurance for six of his twelve full-time employees. The other six employees opt for insurance through other avenues, such as their spouse's plan. "Health care costs are really, really high and that has been a big, big problem," said Wilson.