Small Businesses Tax Credits Begin in 2010

Under the new healthcare reform law, companies (this includes medical practices) with fewer than 25 employees and average annual wages of less than $50,000 will be eligible for a credit for certain contributions to purchase health insurance for employees.  The credit phases in from 35% of the employers contribution to 50% by 2014. Smaller medical practices with 10 or fewer employees and average annual wages of less than $25,000 can get up to a 100% credit. The credit is effective for taxable years beginning after 2009.

Not included in the definition of an employee are seasonal workers, self employed individuals, 2 percent shareholders of an S Corporation , 5% owners of a small business, and dependents. Leased employees are eligible for the credit. These rules are effective as of date of enactment.

About the Author

Reed Tinsley CPA

This article is written by Reed Tinsley, a Houston, TX-based CPA with over 30 years of experience advising physicians and medical practices across Texas and the United States. Reed holds certifications as a Certified Valuation Analyst (CVA), Certified Healthcare Business Consultant (CHBC), and Certified Financial Planner (CFP), specializing exclusively in the healthcare sector. He is a published author, nationally recognized speaker, and trusted advisor to physicians on accounting & tax, practice management, and financial planning. Schedule a Free Consultation.