Introduced by Representative Nitka of Ludlow
Subject: Taxation; income tax; health insurance tax credit for small businesses and self-insurance
Statement of purpose: This bill proposes to provide an income tax credit for small business employers who provide employee health insurance and for individuals who purchase their own health insurance.
AN ACT RELATING TO SMALL BUSINESS HEALTH INSURANCE PREMIUM TAX CREDIT
It is hereby enacted by the General Assembly of the State of Vermont:
§ 5930y. HEALTH INSURANCE PREMIUM TAX CREDIT
(a) Small business health insurance tax credit. A taxpayer of this state with two to 25 full-time employees in Vermont during the entire taxable year shall be eligible for a credit against the tax imposed by this chapter in the amount of four percent of the premiums paid by the taxpayer during the taxable year for health insurance for the taxpayer’s employees in Vermont. To qualify for this credit, the employer must pay at least 80 percent of the total premiums for health insurance during the taxable year for every full-time employee of the taxpayer.
(b) Individual health insurance tax credit. A taxpayer of this state who is not eligible for health insurance coverage paid in part or whole by an employer of the taxpayer or taxpayer’s family member shall be eligible for a credit against the tax imposed by this chapter in the amount of four percent of the premiums paid by the taxpayer during the taxable year for health insurance for the taxpayer and his or her family.
(c) Limitation. No credit shall be allowed under this section for premiums paid in the taxable year for which the taxpayer has claimed a federal income tax deduction.
Sec. 2. EFFECTIVE DATE
This act shall apply to taxable years beginning on and after January 1, 2005.
The Vermont General Assembly
115 State Street