For full information regarding the  Small Business Health Care Tax Credit for Small Employers, please visit the irs.gov website and the instructions for filing the 8941 form.

One of the eligibility rules is the size of the firm.  The rule is a qualifying employer must have less than the equivalent of 25 full-time workers (for example, an employer with fewer than 50 half-time workers may be eligible).

To determine the number of full-time workers follow these steps:

1.  Create an Hours Worked Report for the paid calculations and for the entire year.
2.  Divide the grand total on the report by 2,080 and round down to the next whole number.  This is your number of full-time workers.

You also need to calculate annual average wages to report on the 8941.  Please follow the steps below to determine annual average wages.

1.  Create an Adjusted Gross Wage report
2.  Take the total of Medicare taxable gross wages and divide that by the number of full-time workers.  Round down to next mulitple of $1,000.  This number is your annual average wages.