Kansas' Refundable Tax Credit for Employer-Based Health Insurance

Since 1999, Kansas has provided a refundable tax credit to cover a portion of the expenses of businesses that purchase health insurance coverage for their employees. Eligible employers include those who contribute to health insurance premiums or offer workers the opportunity to participate in health savings accounts. Any small business that has been in existence for less than two years, that employs between 2 and 50 workers, and that has contributed to a health insurance premium on behalf of an employee or made health savings account contributions in the previous two years is eligible for a tax credit of $70 per month per eligible employee. The refund amount phases out over three years, and the tax credit is not available after year three.

The goal of this program is to encourage employers to contribute to health coverage for employees.

Since initial implementation in 2000, the number of participating employers has steadily
increased. During the first four years of the program, 228 employers participated, claiming
nearly $380,000 in credits.