To qualify for the full 50% credit, you must:

• Offer health insurance to every employee who wants to enroll

• Pay a uniform percentage of at least 50% for each employee (can be the cost of single coverage, even for employees who choose family coverage)

• Have 10 or fewer full-time equivalent employees (not counting owners and family members)

• Pay average wages of $25,000 or less (not counting owners and family members)

Important note: Insurance paid for a business owner doesn't qualify for the credit.

Partial Credit Situations

If your company has 11–24 full-time equivalent employees, or if the average wages are between $25,000–$50,000, the credit amount gets reduced. Beyond those limits, the credit drops to zero.

How to Claim the Credit

This tax credit is claimed on the company's annual tax return. It's available for all business types: corporations, LLCs, partnerships, and self-employed individuals.

Time Limit

After 2013, the credit can only be claimed on two annual tax returns.