Final regulations - Tax credit for small employers offering health insurance to employees 

June 26:  The Treasury Department and IRS today released for publication in the Federal Register final regulations (T.D. 9672) concerning the tax credit under section 45R that is available to small employers offering health insurance coverage to their employees.

Today’s 60-page final regulations [PDF 177 KB] finalize regulations that were proposed in August 2013, and like the proposed regulations, the final regulations incorporate provisions of prior IRS guidance (i.e., Notice 2010-44 and Notice 2010-82) concerning health insurance premiums paid by eligible small employers for each employee enrolled in health insurance coverage.

The preamble to today’s final regulations indicates that 14 comments were received in response to the August 2013 proposed regulations; however, no public hearing was requested or held. Today’s final regulations adopt the provisions of the proposed regulations with certain modifications.

Effective date

Section 45R applies to tax years beginning after December 31, 2009. However, in December 2013, the IRS issued Notice 2014-6 to provide transition relief for certain small employers that cannot offer a qualified health plan through a “small business health options program” (SHOP) exchange for 2014.

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