New Jersey Assembly Bill A4007

New Jersey 2024-2025 Regular Session

• Introduced: 3/7/24
• Refer: 3/7/24
• Refer: 6/12/25

Caption

Allows small employers to claim tax credit for paying certain health benefits plan premiums.

Impact

The proposed tax credit structure is tiered based on the percentage of premiums paid by the employer. Specifically, if an employer covers 100% of a premium, they can receive a credit of $250 for single coverage and $500 for family coverage. The credit is proportionately reduced for employers that cover at least 50% but less than 100% of the premiums. This program is set to increase healthcare accessibility for employees of small businesses, potentially reducing the number of uninsured workers in the state. Moreover, it may encourage more small employers to provide health insurance, contributing to a healthier workforce.

Summary

A4007 is a legislative bill introduced in New Jersey that aims to provide tax relief to small employers with fewer than 20 employees. The primary focus of the bill is to allow these employers to claim a tax credit for the health benefits plan premiums they pay for their employees, given that the plans meet the comprehensiveness requirement outlined in the Affordable Care Act. The bill provides a financial incentive for small businesses to offer health insurance, which can improve employee retention and job satisfaction in a competitive labor market.

Contention

Notably, the bill excludes certain entities from claiming these credits. For instance, partnerships and New Jersey S Corporations are ineligible to directly claim these tax credits, which may lead to concerns among small business owners that are structured in those formats. Such exclusions could be a point of contention, as advocates may argue that all small businesses should benefit from similar incentives, irrespective of their tax structure. The financial implications of implementing this bill may stimulate discussions around state budget allocations and economic impacts on small businesses across the region.