A nonrefundable credit is available to employers for certain wages and health insurance costs paid or incurred for qualified full- or part-time employees. The employee or their spouse must be an enrolled member of an Indian tribe. The credit is equal to 20% of the excess of eligible employee wages and health insurance costs. It applies to the first $20,000 in wages paid to the employee.
Eligibility: An individual who received more than 50% of wages from services performed in the trade or business of the employer is a qualified employee for any period only if:
1) The individual or their spouse was an enrolled member of an Indian tribe.
2) And substantially all of the services performed during the period by the employee were performed within an Indian reservation.
3) And the principal place of the employee’s abode while performing services was on or near the reservation where the services are performed.
This credit is calculated on IRS form 8845, Indian Employment Credit, and is claimed as part of the general business credit.