A Valuable Tax Credit for ChurchesOVERVIEW
This resource highlights a stand-alone article from the pages of Church Law & Tax Report
In this Feature Report:
One of the main objectives of President Obama's health care reform law (the "Affordable Care Act") is universal health
coverage. The Act contains several provisions to achieve this goal. One of them is a new tax credit that will help small businesses and small tax-exempt organizations (including churches) afford the cost of providing health insurance for their employees. The credit is up to 25 percent of the cost of health insurance premiums paid by a qualifying employer for its employees.
Many church leaders are confused by this provision. After all, how will a tax credit (a reduction in taxes) benefit churches that pay no taxes? In fact, the credit does
benefit tax-exempt entities because the law makes it "refundable," meaning that it is payable in cash.ADDITIONAL INFORMATION