Small business wins big under health reform
Small businesses fuel the U.S. economy. Unfortunately, small businesses are struggling due to the financial burden of providing health care for their employees during tough economic times. But with health reform, some of this financial burden will be lifted, and employers will be able to help their employees get the care they need.
The passage of health reform will provide immediate and long-term help for businesses. So, as many business owners would say: Let's talk about the numbers.
According to the Small Business Majority many small business should be seeing tax credits immediately if they provide insurance to their employees:
...approximately 4 million small businesses will qualify in 2010 for the tax credit to offset employer health plan costs.
These tax credits will help struggling small businesses afford the rising costs of health insurance and subsequently keep their doors open.
How do these credits actually work? With the help of the Small Business Majority here are those details:
Beginning in 2010 and through 2013, businesses with fewer than 25 full-time employees that contribute at least 50% of the total premium will be eligible for tax credits of up to 35% of the employer contribution. The full credit will be available for businesses with fewer than 10 employees averaging less than $25,000 annual wages, and phase out at $50,000. Nonprofit organizations will qualify for tax credits of up to 25% of the employer contribution during this time period.
This provides immediate help for many small businesses who are struggling to make their payrolls. But what happens after 2013? The credits become more lucrative. According to the SBM:
Beginning in 2014, eligible small businesses purchasing coverage via an exchange will receive tax credits of up to 50% of the employer contribution if the employer provides at least 50% of the premium cost.
Not only should businesses receive a better deal from entering an insurance exchange with other owners, but those tax credits increase past 2013.
Finally, numerous Americans want to know "How will health reform help me?" Luckily, the SBM has produced a Tax Credit Calculator that shows business owners how much their individual tax credit could be under this new legislation. Owners simply plug in a few specific numbers pertaining to their own establishment, and out comes the amount they can expect to receive as a tax credit.
Financially, this is a big win for small businesses. A lesser-known side effect of health reform is that in relieving employers of the burden of sky-high premiums, small business can retain valuable and talented employees. Before health reform passed, big companies had a leg up on small business because they could afford to offer excellent benefits -like health care-to employees. Health reform helps to level that playing field.
Health reform helps millions Americans, including our small businesses. Without their success, the fate of our economy is in question, and reform gives them a much-needed boost.