Small Business Health Insurance Credit

If you saw President Obama give last week's State of the Union speech, you would have heard him mention how Jim Houser, Co-owner of Hawthorne Auto Clinic, would be getting a $5,000 tax credit to help his small business provide health insurance to his employees under the new Patient Protection and Affordable Care Act.

Jim and the Hawthorne Auto Clinic are customers of ours and we computed the tax savings for him that the President used in his speech. Jim was in the balcony for the speech and I'm both proud of him for his activism and leadership that got him there, and I'm proud of TriLibrium for being just one step removed from the White House.

The tax credit is available to certain small business with tax years beginning in 2010, for those that provide health insurance coverage to their employees. It is also available to certain non-profits and even household employers.

The rules are too complex to go into here but the IRS has a frequently asked questions page that should answer many of your questions. I suggest you start their and then speak with your CPA to find out how you can benefit from this legislation.

Non-Business Energy Tax Credit

Time is running out to take advantage of energy saving investments in your principle residence. The Non-business Energy Property Tax Credit was increased as part of the American Recovery and Reinvestment Act of 2009. I've written about these before (and here)but wanted to bring them to your attention once again as they are set to expire at year end.

First, to qualify, the improvements must be placed in service before January 1, 2011.

Here are some of the important facts to keep in mind:

• The law increased the credit rate to 30 percent of the cost of all qualifying improvements and raised the credit limit to $1,500 total for 2009 and 2010 combined
• The credit applies to improvements in insulation, energy-efficient windows, and energy-efficient heating and air conditioning systems.
• For purposes of the credit, to qualify as "energy efficient", the product must generally meet certain standards. If you have questions, make sure you make the determination before you purchase the product to make sure you qualify.
• Manufacturers must certify that their products meet the standards and must provide a written statement to the taxpayer, either with the product or on their website.
• The improvements must be made to your principle residence located in the United States. A second home or rental property would not qualify for the particular credit.
• You must claim the credit on the tax return for the year that the improvements were made.

Oregon residents should also determine if their investment would qualify for the Oregon Residential Energy Tax Credit (RETC). Oregon residents might also qualify for special incentives from the Energy Trust of Oregon.

You should also check the Database for State Incentive for Renewables & Efficiency to what other local incentives might be available around the country.

Small Business Tax Credits in the Health Bill

It is busy season at TriLibrium so I've had little time to blog. I'm excited to get back to regular postings after April 15th.

In the meantime, I'd like to at least link my readers to an article that highlights some of the eligible tax credits for small business and tax-exempt organizations in the Patient Protection and Affordable Care Act which was just signed into law.

The good news for 2010 is that eligible small business can get a tax credit up to 35 percent of the premiums paid by employers. Tax-exempt organizations are eligible for a 25 percent credit.

The maximum credits are for small employers (less than 25 full-time equivalents) paying average wages less than $50,000 per year. Reduced credits are still available for organizations outside these ranges.

You can find more details at WebCPA.