IRS provides additional guidance for businesses on tax credit

Small businesses trying to figure out if they qualify for federal tax credits under the new healthcare law received some extra guidance today. 

The Internal Revenue Service published additional guidelines Monday to help small businesses determine whether they are eligible for the new healthcare tax credit and the size of the credit, which goes into effect this year, according to an IRS release. 

The release clarifies that small businesses receiving state healthcare tax credits may still qualify for the full federal tax credit and also credits for add-on dental and vision coverage, the release said. The IRS also is asking for public comment on issues that need to be addressed. 

For tax years 2010 to 2013, the maximum credit is 35 percent of premiums paid by eligible small businesses, and 25 percent paid by tax-exempt organizations. The maximum credit goes to smaller employers -- those with 10 or fewer full-time equivalent employees paying average wages of $25,000 or less. The credit is phased out for employers that have 25 full-time employees or more that pay average wages of $50,000 a year and above. 

For the notice released today, click here. 

For a step-by-step guide, click here.