If you are a small business with 50 or fewer eligible employees, you are NOT legally required to provide health insurance for your workers under the Affordable Care Act ("ACA"). Small employers now have a new option to find and purchase health insurance with targeted incentives for small for- profit and non-profit businesses.

To be eligible for the Small Business Health Options Program (SHOP), your business or organization must:

• Have a primary business address within New York State
• Have at least one common-law employee
• Have 50 or fewer eligible employees
• Offer coverage through the SHOP to all eligible employees

Small Business Tax Credit

If you're a small employer who purchases coverage through the SHOP, you have exclusive access to an expanded Small Business Healthcare Tax Credit. This tax credit covers as much as 50% (35% for non-profits) of the employer contribution toward premium costs for eligible employers who have low- to moderate-wage workers.

To qualify for the Small Business Tax Credit, a small business must meet the following criteria:

• Fewer than 25 full-time equivalent employees
• Pay average annual wages below $50,000
• Contribute 50% or more toward your employees' self-only health insurance premiums (lowest cost single plan only)

The credits phase out as firm size and/or average wage increases (see table below for illustration). The credit is available to offset actual tax liability and is not payable in advance to the taxpayer or refundable. The business must claim the credit at the end of the year on its income tax return. Talk with your tax professional to determine if your small business qualifies for any or all of the tax credits available.

Call Bond's Small Business Team at 585-248-5870 with any of your questions.