1) Does the employer pay at least 50% of the employee insurance premiums at the single (employee-only) coverage rate?
If yes, continue to Step 2. If no, stop here. You do not qualify for the credit.
2) Determine the total number of employees (not counting owners or family members).
Full-time employees _________
(Enter number of employees that work at least 40 hours per week.)
plus
Full-time equivalent employees _________
(Calculate the number of full-time equivalents by dividing total annual hours of part-time employees by 2,080.)
equals
Total employees _________
If the total number of employees is less than 25, continue to Step 3. If no, stop here. You do not qualify for the credit.
3) Calculate the average annual wages of employees (not counting owners or family members).
Total annual wages (Medicare wages) paid to employees _________
divide by
Number of total employees from Step 2 _________
equals
Average wages * _________
* If the result is less than $56,000 (2021), the employer may qualify for the Small Business Health Care Tax Credit.
