Monday, February 21, 2011

Small Business Healthcare Tax Credit


If you own a small business your mind probably reels with a variety of information tidbits all necessary to keep you company moving forward. Like a well oiled machine you process requests each day that make adjustments to your future planning and forecasting. This level of functioning is most likely second nature to you which means that any major change in your mental machine can throw a wrench in the workings of your day to day progress and forecasting.

With all of the changes to the tax credits and healthcare details in 2010 I suspect that many a business owner found their mental machines grinding through a few wrenches. A lot of people  that I know have been particularly vexed about the health care credit and how they can determine whether or not it applies to them or is to their benefit. To help clear the air, I did a little research and here is the simple version of what I found.

You may qualify for the credit IF:
  • You (the employer) pay for at least 50% of the coverage costs of some of your employees based on a single person coverage rate.
  • Your business employs less than the equivalent of 25 full time workers.
  • The average annual wage paid by your company to employees is less than $50,000. (The key word here is “average”.)
Click Here for a Quick Qualification Worksheet

Things to Note:
  • Both taxable businesses and tax exempt organizations are equally eligible based on the criteria above. The difference is in the percentage of credit given to the business/organization. The maximum credit available for a taxable business is 35% of the premium costs paid by the business in 2010. For tax exempt organizations the maximum credit is 25% of the premium costs paid in 2010.
  • If you qualify for the credit and wish to claim it on your 2010 filing, use Form 8941.

For additional information check out these helpful tools:

Monday, February 14, 2011

Its February 14th... Do you know where your W2 Form is?


Is your W2 form missing in action? With this important piece lacking from your paper pile you are probably feeling a mounting frustration of to pay or not to pay. To end your tax crisis, here is how you can track down this missing information to complete your tax return.
  1. Contact your employer and ask then when the form was mailed to you. If they indicate that the form was mailed a week or more prior to your call, it may have gotten lost in transition. Be sure that the employer has your full and correct mailing address so that they can re-send it to you once it is returned to them. Either way, you should have it or know that you will have it shortly before February 14th.
  2. Don't know where your W2 form is? Then get on the phone and call the IRS at 800.829.1040. You will need to provide then with your name, address, city, state, zip code, Social Security Number and telephone number. They will also ask you to provide your employer’s name, address, city, state, zip code and telephone number along with your dates of employment and an estimate of the wages you earned for 2010. This information is needed in order for the IRS to back track and help you locate the W2 information needed to complete your tax return filing.
  3. Listen Up! Just because you don’t have a W2 form does not mean that you can pass on filing your taxes. You have a couple of options – file an extension to allow you more time to track down your W2 or file your taxes with Form 4852 (a substitute for Form W2). If you file your taxes on time using a Form 4582 and your W2 form shows up with significantly different information from that listed on the 4582, you will want to file Form 1040X. Completing and sending this form to the IRS will amend your initial filing with the correct information.  
As always, be sure to check with the IRS or your Tax Preparer to be sure that your Income Tax Return includes all of the necessary information for the IRS to process your filing. Then cross your fingers that you get a refund and don't have to write a check!