Do you Qualify?

The Affordable Care Act was passed in 2010 and created a tax credit called the Small Business Health Care Tax Credit for Small Employers. This credit helps subsidize the cost of employer-provided healthcare insurance for the employees of small businesses, including churches.

As you are aware, churches are non-profit but are not required to file a Form 990 tax return.  Because of this many churches have missed this valuable credit which could be as high as 25% of the health insurance expense you pay on behalf of your employees.

It’s Easy…

There are a few requirements to qualify for this credit:

1. You must have less than 25 employees.

2. The church must pay for more than half of at least one employee’s insurance.

3. The church must be a 501 (c) not for profit organization.

Here is an example: A church has 9 employees and their average annual wage is $30,000.  During the year the church provided health insurance for 3 of these FTEs at a cost of $18,000 ($6000 for each FTE).  The tax credit due to this church would be 20% or $3,600.

As you can see this is substantial.  Additionally we can file for this credit all the way back to 2011.  That would be more than $10,000 in this example.  (Please note the 2011 credit must be filed before 12/31/2014)

It is best to use a tax professional who can maximize the credit.  Byerly & Associates can give you a free evaluation to see if your church qualifies.  Contact us today.