PURPOSE AND BACKGROUND
Section 45R of the Internal Revenue Code (Code) offers a tax credit to certain
small employers that provide health insurance coverage to their employees. It is
effective for taxable years beginning in 2010. Both taxable employers and employers
that are organizations described in section 501(c) that are exempt from tax under
section 501(a) (tax-exempt employers) may be eligible for the section 45R credit.
Employers that satisfy the requirements for the credit are referred to in this notice as
“eligible small employers.”
Section 45R was added to the Code by section 1421 of the Patient Protection
and Affordable Care Act (Affordable Care Act), enacted March 23, 2010, Pub. L. No.
111-148. This notice provides guidance on section 45R as in effect for taxable years
beginning before January 1, 2014, and also includes transition relief for taxable years
beginning in 2010 with respect to the requirements for a qualifying arrangement under
To read the details of the regulations and to find out if you qualify go to this link: