IRS Forms 8941 and 990-T

Under the 2010 Obamacare law, the US Government is giving money to small businesses, including churches. Form 8941 and Form 990–T enable small employers to get money based on the number of FTEs (full-time equivalent employees) if that number is less than 25, if the church paid employer health insurance, and if the average salary of the FTEs is less than $50,000. Below are the three conditions for filing (straight from the IRS):

1. You paid premiums for employee health insurance coverage under a qualifying arrangement. A qualifying arrangement is generally an arrangement that requires you to pay a uniform percentage (not less than 50%) of the premium cost for each enrolled employee’s health insurance coverage (defined later). However, an arrangement that requires you to pay a uniform premium for each enrolled employee (composite billing) and offers different tiers of coverage (for example, self-only, self plus one, and family coverage) can be a qualifying arrangement even if it requires you to pay a uniform percentage that is less than 50% of the premium cost for employees not enrolled in self-only coverage. In addition, an arrangement that requires you to pay a separate premium for each employee based on age or other factors (list billing) can be a qualifying arrangement even if it requires you to pay a uniform percentage that is less than 50% of the premium cost for some employees.

2. You had fewer than 25 full-time equivalent employees (FTEs) for the tax year. You may be able to meet this requirement even if you had 25 or more employees. For details, see Individuals Considered Employees and Full-Time Equivalent Employee (FTE) Limitation, later.

3. You paid average annual wages for the tax year of less than $50,000 per FTE.

I submitted the forms for a couple of clients who each got back over $6,000 for each year filed, and there are 3 years which can be applied for (2010, 2011, and 2012). The money came in about 2-3 months in a check from Uncle Sam; no one from Washington made any inquiries or calls about this.

“If it sounds too good to be true, thus it must not be.” Not in this case. One of my clients has close connections to Rep. Eric Cantor’s office. A church member contacted a staffer in Cantor’s office and the staffer said this is all legit and furthermore, the government would not use this as a way to “get into the business” of non-profits and churches.

Uncle Sam is giving away money – get it or lose it. If you need more info, please contact your auditor or email me and I’ll help.

Lead On!