The Small Business Health Care Tax Credit

Certain Massachusetts small businesses and nonprofit organizations are eligible for federal tax credits that will help offset some of their cost of offering health insurance to their employees. The tax credit will cover up to 50% of an employer’s costs (up to 35% for a non-profit organization).

To qualify for the tax credit, all of the following must apply:

  • You must have fewer than 25 full-time equivalent employees (FTEs)
  • Your average employee salary is about $50,000 a year or less
  • You must pay at least 50% of your full-time employees’ premium costs
  • You must offer coverage for your full-time employees through the Health Connector’s small business Marketplace.

Here are some examples of how the small business health care tax credit works:

For more information, including calculators and FAQs, go to the IRS small business health care tax credit site.

If you have questions

  • Phone: 1-888-813-9220 or TTY: 711, Monday–Friday, 8:00 a.m.–6:00 p.m.
  • Fax: 617-722-4033
  • Email: SmallBusiness@state.ma.us
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