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DelBene introduces legislation to expand tax credits for small businesses

U.S. Rep. Suzan DelBene - Courtesy photo
U.S. Rep. Suzan DelBene
— image credit: Courtesy photo

Congresswoman Suzan DelBene introduced legislation that expands tax credits for small businesses to make offering health coverage to their workers more affordable.

Her bill is the companion to legislation introduced last week by Senator Mark Begich from Alaska. Congressman Frank Pallone (NJ-3) and Congresswoman Carol Shea-Porter (NH-1) are also original cosponsors of the House bill.

Called the Small Business Tax Credit Accessibility Act (H.R. 4128), the bill is a fix to the Affordable Care Act that would improve, expand, and simplify the small business tax credit. It makes the tax credit more accessible and available for a longer period of time, helping to ensure that more small businesses can provide affordable, high-quality health insurance to their workers.

“Growing our economy means supporting our small businesses, and one straightforward way to do this is to help business owners with the cost of health coverage. It’s clear that the small business tax credit created under the Affordable Care Act, while well-intentioned policy, can be improved to better serve the needs of small businesses,” DelBene said. “The Small Business Tax Credit Accessibility Act is a commonsense fix that will help entrepreneurs and workers nationwide. This bill is about making sure that federal policy actually works in the real world, and I believe it represents responsible, meaningful reform to the Affordable Care Act.”

The Small Business Tax Credits Accessibility Act would:

· Raise the maximum size of the business that is eligible to receive the tax credits from 25 employees to 50 employees.

· Extend a 35% tax credit to small businesses purchasing coverage outside the SHOP exchange in 2014, while maintaining the tax credit of 50% for coverage purchased on the SHOP exchange.

· Increase the number of years for which a small business may receive the tax credit to any 3 consecutive years.

· Extend the credit to firms with higher average wages, and tie the calculation of average wages to the federal poverty line.

· Increase the threshold for a firm to receive the biggest possible credit from 10 to 20 full-time employees.

· Allow some family members of small business owners to directly benefit from the tax credits.

· Eliminate the requirement that employers claiming the credit contribute the same percentage of the cost of each employee’s health insurance.

· Simplify calculations by eliminating the cap that limits eligible employer contributions to average premiums in the state.

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