PROVIDENCE – The U.S. Internal Revenue Service unveiled its latest form, Credit for Small Employer Health Insurance Premiums, Form 8941, along with final guidelines, on Dec. 2.
The guidelines and form were detailed at an informational session about the credit hosted by U.S. Sen. Sheldon Whitehouse at the Johnson & Wales University Culinary Archives and Museum on Dec. 6.
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Whitehouse, along with local IRS representative Odette Turenne, provided details about how Rhode Island small businesses can claim the tax benefits for the cost of providing health insurance to their employees during 2010. The tax benefit is available for businesses with less than 25 full-time employees with an average salary below $50,000, and contributed to health insurance coverage for 50 percent of employees. The 2010 tax credit will enable small businesses to claim up to 35 percent of the cost of health insurance.
Nonprofits can also apply for similar health care tax credits, with benefits provided to reduce payroll taxes up to 25 percent for the costs of providing health insurance to employees in 2010.
In an interview with PBN, Whitehouse stressed the importance of getting the word out to Rhode Island small businesses about this opportunity. “It’s important that Rhode Island small businesses not leave these benefits on the table through not being aware that they are there,” he said.
Whitehouse identified some of the challenges Rhode Island will face in its implementation of health care reform. “The big issues that Gov.-elect [Lincoln D.] Chafee faces are setting up the health exchanges, so that there’s a clear, fair standard market that people can compete in, and trying to make sure the Medicaid waiver is something that the state is meeting its targets on,” Whitehouse said. “We’re prepared to be as helpful as we can on both of those areas.”
Both he and U.S. Sen. Jack Reed have met individually with Chafee, Whitehouse said, calling it “the beginning of a continuing dialogue where we can work together to be effective for the people of Rhode Island.”
Whitehouse also praised the work of the Rhode Island Quality Institute, the only such institute in the country to win all three of the major quality reform grants to spur improvement in the delivery of health care services. “We’re going to see a lot of progress as the federal money gets deployed,” he said.
Dale J. Venturini, president and CEO of the Rhode Island Hospitality Association, called the health care tax credit “a lifeline” for small businesses. “It is a lifeline; I am hoping that people grab onto it,” she said. “Right now, we’re at a crossroads, where people in small businesses have done everything to stay afloat, they have taken out loans, they’ve borrowed from their families, they’ve used their credit cards, they’ve mortgaged their homes. They need this help to stay alive.”
Venturini said informational sessions such as this one were imperative. “You get to learn first hand, you get to have interactions. Someone might ask a question that you may not think about, and you have one of those, ‘Aha!’ moments,” she said. Venturini said she saw a lot of people attending she knew from associations and chambers of commerce and banks. “We’re the ones who can filter this information out to our members and our customers,” she said.
For more details, go to www.irs.gov, and search for health care tax credit.
