Tuesday, January 18, 2011

Own a Business? 6 New Tax Breaks

If you own a small business, you know how expensive it can be. Looking for more ways to save? You must check out this article from CNN.com explaining six important new tax breaks. I've included a snippet of the article below.

    Health care tax credit:

    Small businesses that pay at least half of their employee's health coverage can get a significant tax refund.

    The maximum credit goes to businesses with 10 or fewer full-time employees with annual wages that average $25,000 or less. The break phases out for firms with 25 employees or that pay average wages above $50,000.

    For 2010 through 2013, the tax credit covers up to 35% of the money that a qualifying business spends on its health insurance premiums. In 2014, the top tax credit bumps up to 50%. Tax-exempt organizations can claim 25% in the first time period and 35% after that. The credit is available for a maximum of six years: 2010 through 2013 and for any two years after that.

    Health insurance deduction for self employed:

    Are you your own boss and paying for your own health insurance?

    Normally, you can deduct your insurance costs from your business profits, but you can't deduct those costs from your self-employment taxes. But in 2010, the self-employed can deduct their health insurance costs from their business profits for both taxes. Let's say Sally, an architect, makes $50,000 in net income and pays $6,000 for health insurance.

Read more at CNN.com...

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