You may be missing out on a great deal if you are a business under 50 employees and DO NOT join the exchange… at least in 2015
1- Employers have to pay part of the premium, in most cases at least 50%
2- Employee contributions are only deductible to them if they hit 10% of their income (and most people don’t have enough expenses to itemize, anyway)
3- While the premiums paid by the employer are deductible there is no Tax Credit
UNDER THE SHOP EXCHANGE-
1- Employers are not required to pay a penny.
2- Employees may be eligible for a “Premium Tax Credit”, AKA a subsidy. They get cheaper premiums.
3- IF the employer pays 50% of the premium, you may get a Tax Credit as well as the deduction.
SMALL BUSINESS PLAN OF ACTION-
If you are currently providing coverage for your employees – We need to evaluate your options under SHOP
If you are currently ALLOWING your employees to get dependents covered, but not paying anything towards it – consider DROPPING dependents all together. They can get a subsidy under the Exchanges, but only if their spouses insurance does not allow dependent coverage!
If you are not offering coverage – and your employees generally are above 400% of the Federal Poverty Level, sign up for SHOP and make sure your employees know about the potential tax savings
If you are not offering coverage – and your employees generally make less than 400% of the FPL – sign up for Shop and make sure your employees understand about the subsidy.