Vision Payroll

September 7, 2010

IRS Releases Draft of New Form 8941

IRS Releases Draft of New Form 8941
IRS Releases Draft of New Form 8941
In IR-2010-096, the Internal Revenue Service (IRS) today announced the release of a draft version of new Form 8941, Credit for Small Employer Health Insurance Premiums. Vision Payroll has previously provided details on how employers become eligible for the Small Business Health Care Tax Credit (the Credit).

Small Businesses and Tax-Exempt Organizations Will Use Form 8941

Since Form 8941 is used to calculate the amount of the Credit, both taxable small businesses and tax-exempt organizations will use it. The Credit will then be carried to a tax return to be filed by the employer.

Entity Type Determines Reporting of Credit

Many small businesses will report the amount of the Credit on Form 3800, General Business Credit. Others may pass it through to other taxpayers such as partners, S corporation shareholders, trust beneficiaries, etc.

Tax-Exempt Organizations Will Use Form 990-T to Claim Credit

Tax-exempt organizations will claim the Credit on a revised Form 990-T, Exempt Organization Business Income Tax Return (and proxy tax under section 6033(e)). Tax-exempt organizations not otherwise required to file Form 990-T will be required to file it to claim the Credit.

Contact Vision Payroll if you have further questions on the Small Business Health Care Tax Credit.

July 10, 2010

Transition Relief for Employers That Do Not Pay at Least Fifty Percent of the Premium

The new health reform law gives a tax credit to certain small employers that provide health care coverage to their employees, effective with tax years beginning in 2010. Over the past several weeks, Vision Payroll has provided information on the Small Business Health Care Tax Credit. Today’s topic is Transition Relief for Employers That Do Not Pay at Least Fifty Percent of the Premium.

The Internal Revenue Service (IRS) expects to issue transition relief that will allow employers that otherwise qualify to claim the credit even if those employers do not pay at least 50% of the premium cost for all employees. Employers are required to pay at least 50% of the cost for single coverage. For employees with more expensive coverage, such as family coverage, employers that otherwise qualify to claim the credit will qualify as long as they pay at least 50% of the premium cost for single coverage toward the more expensive coverage. Therefore, employers might still qualify even if they pay less than 50% of the cost of the more expensive coverage.

This concludes this series on the Small Business Health Care Tax Credit. Contact Vision Payroll if you have further questions on Transition Relief for Employers That Do Not Pay at Least Fifty Percent of the Premium or the Small Business Health Care Tax Credit.

July 6, 2010

Transition Relief for Employers That Do Not Pay a Uniform Percentage

The new health reform law gives a tax credit to certain small employers that provide health care coverage to their employees, effective with tax years beginning in 2010. Over several weeks, Vision Payroll will be providing further information on the Small Business Health Care Tax Credit. Today’s topic is Transition Relief for Employers That Do Not Pay a Uniform Percentage.

The Internal Revenue Service (IRS) expects to issue transition relief that will allow employers that otherwise qualify to claim the credit even if those employers do not pay a uniform percentage for all enrolled employees. As long as the employer pays at least 50% of the premium cost for each enrolled employee, the percentage paid will not need to be uniform for all employees.

The final topic to be covered in this series is Transition Relief for Employers That Do Not Pay at Least Fifty Percent of the Premium. Contact Vision Payroll if you have further questions on Transition Relief for Employers That Do Not Pay a Uniform Percentage.

July 5, 2010

Impact of the Small Business Health Care Tax Credit on Employment Tax Payments

The new health reform law gives a tax credit to certain small employers that provide health care coverage to their employees, effective with tax years beginning in 2010. Over several weeks, Vision Payroll will be providing further information on the Small Business Health Care Tax Credit. Today’s topic is Impact of the Small Business Health Care Tax Credit on Employment Tax Payments.

Employers may not reduce the amount of employment tax payments paid and use the Small Business Health Care Tax Credit to offset the taxes not paid. Federal employment taxes include both those imposed on the employer and those imposed on the employee. They include federal unemployment tax, the employer portion of Old-Age Survivors and Disability Insurance (OASDI) tax, also known as social security and Medicare, federal income tax withheld, social security tax withheld, and Medicare tax withheld. The Small Business Health Care Tax Credit may only offset income tax.

The next topic to be covered in this series is Transition Relief for Employers That Do Not Pay a Uniform Percentage. Contact Vision Payroll if you have further questions on Impact of the Small Business Health Care Tax Credit on Employment Tax Payments.

July 4, 2010

Impact of the Small Business Health Care Tax Credit on Deductions for Health Insurance Premiums

The new health reform law gives a tax credit to certain small employers that provide health care coverage to their employees, effective with tax years beginning in 2010. Over several weeks, Vision Payroll will be providing further information on the Small Business Health Care Tax Credit. Today’s topic is Impact of the Small Business Health Care Tax Credit on Deductions for Health Insurance Premiums.

The amount of premiums that can be deducted on the employer’s federal income tax return must be reduced by the amount of the Small Business Health Care Tax Credit.

The next topic to be covered in this series is Impact of the Small Business Health Care Tax Credit on Employment Tax Payments. Contact Vision Payroll if you have further questions on Impact of the Small Business Health Care Tax Credit on Deductions for Health Insurance Premiums.

June 20, 2010

Impact of the Small Business Health Care Tax Credit on Estimated Tax Payments

The new health reform law gives a tax credit to certain small employers that provide health care coverage to their employees, effective with tax years beginning in 2010. Over several weeks, Vision Payroll will be providing further information on the Small Business Health Care Tax Credit. Today’s topic is Impact of the Small Business Health Care Tax Credit on Estimated Tax Payments.

The amount of the credit that will be allowed may be used in determining the amount of estimated tax payments that must be made in accordance with the rules for making such payments.

The next topic to be covered in this series is Impact of the Small Business Health Care Tax Credit on Deductions for Health Insurance Premiums. Contact Vision Payroll if you have further questions on Impact of the Small Business Health Care Tax Credit on Estimated Tax Payments.

June 19, 2010

Claiming the Small Business Health Care Tax Credit Without Taxable Income for Tax-Exempt Employers

The new health reform law gives a tax credit to certain small employers that provide health care coverage to their employees, effective with tax years beginning in 2010. Over the next several weeks, Vision Payroll will be providing further information on the Small Business Health Care Tax Credit. Today’s topic is Claiming the Small Business Health Care Tax Credit Without Taxable Income for Tax-Exempt Employers.

The Small Business Health Care Tax Credit will be claimed by tax-exempt employers as a refundable credit. As such, the only limit is the previously discussed limit of federal income tax withholding and Medicare tax liability.

The next topic to be covered in this series is Impact of  the Small Business Health Care Tax Credit on Estimated Tax Payments. Contact Vision Payroll if you have further questions on Claiming the Small Business Health Care Tax Credit Without Taxable Income for Tax-Exempt Employers.

June 15, 2010

Claiming the Small Business Health Care Tax Credit Without Taxable Income

The new health reform law gives a tax credit to certain small employers that provide health care coverage to their employees, effective with tax years beginning in 2010. Over the next several weeks, Vision Payroll will be providing further information on the Small Business Health Care Tax Credit. Today’s topic is Claiming the Small Business Health Care Tax Credit Without Taxable Income.

The Small Business Health Care Tax Credit will be claimed by employers, other than tax-exempt employers, only to the extent of income tax liability or alternative income tax liability. For 2010, unused credits may generally be carried forward twenty years, in accordance with the general business credit rules. For 2011 and beyond, the credit may also be carried back one year.

The next topic to be covered in this series is Claiming the Small Business Health Care Tax Credit Without Taxable Income for Tax-Exempt Employers. Contact Vision Payroll if you have further questions on Claiming the Small Business Health Care Tax Credit Without Taxable Income.

June 9, 2010

Tip of the Week: New IRS Guidance on the New Health Care Tax Credit

As one of the health care reform provisions of the Patient Protection and Affordable Care Act (PPACA), a tax credit is available to help offset the employer health care cost of offering employee benefits. On May 17, 2010, the Internal Revenue Service (IRS) provided new detailed guidance especially helpful for small businesses. With this information, small employers could determine their tax credit qualification and the estimated credit amount.

Do you understand the tax credit qualification process? Do you know the three steps in the determination process? Are you aware of the employer considerations for the credit?

For detailed information on these processes, employer considerations and much more, be sure to read the featured article by the HR pros at MyHRSupportCenter, New IRS Guidance on the New Health Care Tax Credit. If you’re not yet signed up or would like a free trial of MyHRSupportCenter, contact Vision Payroll today.

May 24, 2010

Claiming the Small Business Health Care Tax Credit

The new health reform law gives a tax credit to certain small employers that provide health care coverage to their employees, effective with tax years beginning in 2010. Over the next several weeks, Vision Payroll will be providing further information on the Small Business Health Care Tax Credit. Today’s topic is Claiming the Small Business Health Care Tax Credit.

The Small Business Health Care Tax Credit will be claimed by employers, other than tax-exempt employers, on their annual income tax return.

The next topic to be covered in this series is Claiming the Small Business Health Care Tax Credit Without Taxable Income. Contact Vision Payroll if you have further questions on Claiming the Small Business Health Care Tax Credit.

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