I have heard from so many small business owners across Washington state who were struggling under the skyrocketing costs of health care.

That is why I am so proud that under the new health care law, 103,000 small businesses in Washington could be helped by a new small business tax credit that makes it easier for businesses to provide coverage to their workers and makes premiums more affordable. 

Small businesses pay, on average, 18 percent more than large businesses for the same coverage, and health insurance premiums have gone up three times faster than wages in the past ten years. This is unfair, and it needs to change.

So this tax credit is just the first step towards bringing those costs down and making coverage affordable for small businesses.

• Small employers with fewer than 25 full-time equivalent employees and average annual wages of less than $50,000 that purchase health insurance for employees are eligible for the tax credit.

• To be eligible for a tax credit, the employer must contribute at least 50 percent of the total premium cost.

• The maximum credit will be available to employers with 10 or fewer full-time equivalent employees and average annual wages of less than $25,000.

• Businesses that receive state health care tax credits may also qualify for the federal tax credit. Dental and vision care qualify for the credit as well.

• For 2010 through 2013, eligible employers will receive a small business credit for up to 35 percent of their contribution toward the employee’s health insurance premium. Tax-exempt small businesses meeting the above requirements are eligible for tax credits of up to 25 percent of their contribution.

• Eligible small businesses can claim the credit as part of the general business credit starting with the 2010 income tax return they file in 2011. For tax-exempt organizations, the IRS will provide further information on how to claim the credit.

For more information on these tax credits, please visit:
http://www.irs.gov/newsroom/article/0,,id=223666,00.html.