Tax Implications of Providing Health Insurance to Employees – 2024 Guide
Blanche Palasi1 Jan 2024
Main Points to Understand
|Tax Deductions for Employers Offering Health Insurance
|Eligibility for Employee Deductions
|Health Insurance Tax Credit for Small Employers
|Tax Exclusions for Employees
|Frequently Asked Questions
|In Summary
|Providing health insurance to your employees supports their wellbeing and carries tax implications that can benefit your business. Health insurance for employees is a tax-deductible business expense, and small businesses may qualify for tax credits under the Affordable Care Act (ACA).
Main Points to Understand
- Health insurance premiums are considered a business expense, hence they are tax-deductible.
- Most health insurance, including medical, dental, and vision, could be considered business expenses.
- Premiums and other medical expenses can only be deducted if they exceed 7.5% of your Adjusted Gross Income.
- Tax credit programs for small businesses are available through the Small Business Healthcare Tax Credit and American Rescue Plan.
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Blanche Palasi is a 2024 PharmD. Candidate currently attending St. John's University. A Queens native, she is passionate about helping patients identify and navigate social determinants of health.
TopicSmall Business