“This is the biggest health care tax cut in history,” Hinojosa said. “Our economy will directly benefit from small businesses helping out their employees. It’s important for small business owners in my district to know help is out there so they can start taking advantage of it immediately.”
The tax credit is available to small businesses with 25 or fewer employees and an average wage of $50,000 or less that provide health insurance for their employees, he said. Companies with 10 or fewer employees and an average wage of $25,000 or less get the maximum credit – 35 percent of what the employer is paying for employee insurance coverage. The maximum credit rises to 50 percent in 2014.
The tax credit is also available to small non-profits, Hinojosa added. For non-profits, the tax credit is worth up to 25 percent of what the employer is paying for employee insurance coverage. The maximum credit for non-profits rises to 35 percent in 2014.
“There are 292,593 companies in Texas that meet the criteria for the tax credit,” Hinojosa said. This is going to make it a little easier for companies already offering insurance to afford it and will allow more small businesses to start providing health care coverage for their workers.”
The tax credits are available now, beginning with this tax year, he said.
Beginning this week, the IRS is mailing more than 4 million postcards to small businesses around the country to help ensure that they realize they may qualify for the credit now.