Obamacare: What Business Owners Need to Know
Blog post written by Camille Morely, St. Olaf Intern.
So you’ve heard the term Obamacare in the news and are wondering what this means for you and your small business? The Patient Protection and Affordable Care Act otherwise known as “Obamacare” was signed in to law as a way to give more American’s access to quality, affordable health care. Today over half of the uninsured are the self employed, small business owners, employees, and their dependants. Looking for more information? The Small Business Administration has upcoming free webinars for small business owners. Follow the link for registration: http://www.sba.gov/healthcare
Here are some important facts to know:
Self Employed (and all individuals)
- A new mandate comes into effect in 2014 that requires all citizens to have health insurance or face a tax of 1% of their income that is capped at a maximum level. Some exceptions apply. This includes those who would qualify for Medicaid under new, higher U.S. income limits, but live in states that aren’t expanding Medicaid eligibility, and those who may not qualify for marketplace subsidies.
- Obamacare does not require you to change health insurance. If your plan was in existence prior to March 23, 2010, it was therefore grandfathered in and doesn’t have to provide the Obamacare benefits. All other plans have to cover the 10 essential health benefits in 2014.
25 employees or less
- You qualify for a tax credit of 35% of the costs of health insurance that rises to 50% in 2014. This credit is available for employers who participate in the Small Business Health Options Program (SHOP).
Less than 50 employees
- By sharing information with your employees about SHOP and other exchanges, if your workers get tax credits through an exchange, you will not be required to pay a fine.
50 or more employees
- Starting in January 2015, if you do not provide health insurance, you must pay a tax of $2,000 per employee (for all but the first 30 employees).
Less than 100 employees
- In 2014 you can shop for health insurance on the exchanges (SHOP) that should provide cheaper alternatives. Also, if you offer health insurance as a benefit to early retirees 55-64, you can get Federal financial assistance.
If you’re curious how the changes in the health care system might affect you, make sure to stop by our lunch and learn session “Obamacare: How does it affect your business” with Sandy Wenker, Certified Public Accountant and Certified Financial Planner on November 26th, 11:30-1:00! Register here!