Tax Tips for 2010

The 2010 tax year is over but most of us have not started our 2010 returns. For small business owners as well as farmers, ranchers and other sole-proprietors, the Affordable Care Act and the Small Business Jobs Act, signed into law in 2010, contain significant tax incentives to help offset health care costs.

The Small Business Jobs Act includes a deduction for sole proprietors’ health care costs on their 2010 tax returns. The self-employed will be able to deduct their health insurance premiums as a business expense that reduces their self-employment tax and their income tax for the 2010 tax year (find out more at

Also, small business tax credits in the Affordable Care Act cover up to 35 percent of employees’ health care costs for businesses with fewer than 25 employees. These two new laws provide crucial relief for family farmers, ranchers and mainstreet business owners who have watched their health insurance premiums double in the last five years.

And there’s another tax change on the horizon, the Rural Microbusiness Investment Credit, which helps entrepreneurs by providing a 35 percent refundable tax credit, up to $10,000, on investment in their business. This tax provision was introduced by Representatives Ron Kind (D-WI) and Wally Heger (R-CA) and, if passed, would help rural small businesses lead the nation out of recession.

So, call your accountant about eligibility for a health care tax incentive, and then call your Representative and urge their support for the Rural Microbusiness Investment Credit.