The big change for those organizations with 25 or fewer employees is Small Business Health Care Tax Credits. Currently, small organizations that pay average annual wages less than $50,000, and that contribute 50 percent or more toward employees’ self-only health insurance premiums may qualify for a small business tax credit of up to 35 percent to help offset the costs of insurance. In 2014, this tax credit goes up to 50 percent and will be available to qualified small employers that participate in the SHOP program.
As Chandler explained, this was a provision nonprofits were lobbying for when health care reform was first being discussed. “This was a tremendous victory for the nonprofit community but there hasn’t been much messaging about it,” she said. Many organizations are unaware of how the tax credit worked and if they were even eligible for it.
There are a multitude of reasons why there has been confusion, but Chandler believes it has to do with the way the government is wording their message. “We noticed that the official messaging about the Affordable Care Act was all about how health care reform affects individuals and ‘businesses’ — when in fact any employer, whether nonprofit or for-profit, is going to be affected,” explained Chandler. “After [NCN] pointed this out, to their credit the IRS, and the Small Business Administration, and even HHS/Office of Faith Based and Community Partnerships made changes in the language used on some web pages to refer to ‘nonprofits’ in addition to businesses.”