Small Business Health Care Tax Credit Estimator
Step 1: Are you a tax-exempt employer?
The credit is refundable for tax-exempt employers, but is limited to the amount of the tax-exempt employerâs payroll taxes withheld during the calendar year.
Step 2: How many of your employees work 40 hours or more a week?
Full-time employees are employees who worked or who you expect to work the equivalent of 40 hours a week for 52 weeks (for a total of 2,080 hours each).
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Step 3: How many hours will your part-time employees work during the applicable year?
Hours for part-time employees who worked or you expect to work less than 40 hours per week, but more than 120 days per year.
If youâre unsure of the number of part-time employee hours, use this part-time employee worksheet to enter hours for each employee.
Step 4: What are your total estimated employee wages for the applicable tax year?
The total wages you paid or expect to pay for both full-time and part-time employees should include all wages subject to Social Security and Medicare tax withholding (even if an employeeâs yearly wages are more than the wage base limit).
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Step 5: Do you pay or plan to pay 50% or more of your employeesâ premiums?
To qualify for the tax credit, generally, you must pay at least 50% of your employeesâ medical premium cost and meet other requirements to claim the credit.
Step 6: What is the total estimated amount you will pay toward premiums during the applicable year?
Only include the portion of premiums you paid or you expect to pay, not what your employees paid or what you expect theyâll pay. You can include premiums paid for seasonal employeesâ coverage. Also include any contributions you made toward dependent coverage and dental plans.
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