Facts & Figures – Manufacturing Deductions & Health Insurance

Manufacturing Deductions—Under Section 199 of the tax code, a business may claim a “manufacturing deduction” equal to 9% of its qualified domestic production income, subject to a limit of 50% of W-2 wages paid out during the year. Now the IRS has issued new regulations clarifying the rules on the W-2 limit in a short tax year. See your professional tax adviser for details.

Health Insurance—Remember that the employer mandate to provide health insurance for full-time employees (FTEs) under the Affordable Care Act (ACA) takes effect for midsize firms on January 1, 2016. This ACA provision was postponed from its January 1, 2015, deadline. For this purpose, a “midsize firm” is one with 50 to 99 FTEs. Larger employers already must comply with this rule.