The IRS said Thursday that it would allow companies to use the tax credits they get from their employees as a way to offset the costs of paying employees’ health care expenses, even if the workers have a disability or other health issues.
The agency also said it would ease restrictions on how much an employee can deduct from wages to help them pay for health care.
The changes are intended to help reduce the cost of employer-provided health insurance.
They also could encourage more employers to provide coverage.
The IRS said it will take the steps to expand the use of the credit starting in 2021 and to phase out the restrictions on it beginning in 2019.
The IRS would not disclose how many employers would be allowed to use it.
The change will apply to companies with 50 or more employees.
It would be phased in over the next five years and would last up to six years.
The changes are part of the IRS’ effort to reduce health care costs for middle-income Americans.