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Health Affordable Care Act impacts tax returns
By Jonathan Mayo
Director of IDA Insurance Services, Inc.
With tax season upon us, it is critical to review how the Patient Protection and Affordable Care Act (PPACA) impacts your small business’s tax returns.
We are all aware of the new payroll tax that began January 1, 2013, but is your dental practice eligible for a health care tax credit? Maybe this year you are not eligible, but what steps can you take to be eligible for a tax credit next year? A health care tax credit sounds great, but less than 5% of reportedly eligible small businesses took advantage of the health care tax credit. Some may not have known about the credit, but many were quoted as being aware. So why did small businesses miss out on the tax credit by not filing their taxes accordingly? Many said they were advised by tax consultants that the IRS filings were too time-consuming and not worth the effort. I will let you decide.
Be aware that the 50% health care tax credit, effective January 1, 2014, is only allowed to be claimed in two consecutive years. There are other phase-out measures within the Affordable Care Act language and the IRS guidelines. Also be aware of the changing health insurance landscape. Beginning October 1, 2013, you and your employees (and all spouse’s employers) will have new options for health insurance. Get familiar with the changing marketplace and tax credits.
This update should get you thinking and planning. What is your plan for health insurance benefits in 2014? What tax credits are you eligible for? Talk frequently to IDA Insurance and your tax advisor this year for money-saving tips.
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