With the implementation of Obamacare and all the mandates and requirements that come along with it, it’s critical for small business owners to understand how the law applies to them, and how to make the most of the tax credits and subsidies available.
The Small Business Health Options Program provides a flexible, affordable, convenient option for businesses that want to provide dental and health coverage to their employees, even if they don’t reach the minimum number required under the law.
What are the requirements to use the SHOP Marketplace?
In order to use the SHOP Marketplace, a non-profit or business must have less than 50 full-time employees, although requirements may vary based on the state your business operates in. The SHOP Marketplace is not intended for those who are self-employed, but rather businesses that have at least one FTE that is not a partner, owner or family member.
What are the benefits of using the SHOP Marketplace?
There are five main reasons that businesses might want to consider the Marketplace when offering benefits to employees.
- Flexibility offers choices regarding how much the business pays, what type of plan is offered to employees, and details regarding the enrollment period.
- Choose from high quality insurance plans offered through private insurance companies through the SHOP Marketplace.
- User-friendly, online system that makes it easy and convenient for the employer.
- Ability to use an agent or broker free of cost, or handle all your coverage on your own.
- Possible tax credits for those with less than 25 employees.
Does my business qualify for the tax credits if I use the SHOP Marketplace?
The Small Business Health Care tax credit is available to those with less than 25 employees that make an average of $50,000 or less each year. In order to qualify for the credit, your business must meet ALL of the following requirements:
- The company covers at least 50% of FTE premium costs
- Coverage is offered to FTE through the SHOP Marketplace
- The business has fewer than 25 FTE
- The average employee makes $50,000 or less each year
Businesses that qualify may receive up to 50% of the contribution made toward employee premium costs. Businesses are not required to offer coverage to part-time employees in order to be eligible for the tax credit.
The SHOP Marketplace is intended to make it easier for small businesses to offer employees medical and dental insurance coverage, with tax credits for those who qualify.
Did you find this information helpful? What questions do you have about the premium tax credits for small businesses? Ask us in the comments below.