Small employers in Washington State may still be eligible to claim the small employer health insurance credit this year. Under the law as written, for the 2014 tax year insurance must be purchased from a state exchange in order to qualify for the credit. However, the IRS has issued transition guidance that employers in counties that don’t have qualifying exchanges can still claim the credit for 2014 if their health plan was eligible under the previous rules. Most of the counties in Washington State qualify for this exception. Also, the credit percentage is higher this year at 50% up from 35% in prior years.