Posts Tagged ‘2012 W2s’

W-2 Reporting of Employer Paid Insurance

Sunday, October 28th, 2012

W-2 ReportingThe Affordable Care Act requires many employers to report the cost of coverage under an employer-sponsored group health plan on employees’ 2012 W-2s.  If you need an earning code for this, please contact your Client Account Manager before processing your final payroll dated in 2012.

All employers that provide “applicable employer-sponsored coverage” under a group health plan are subject to the reporting requirement, except as provided in the transition relief described below.  This includes federal, state and local government entities (except with respect to plans maintained primarily for members of the military and their families), churches and other religious organizations, and employers that are not subject to the COBRA continuation coverage requirements, but does not include federally recognized Indian tribal governments or, until further guidance, any tribally chartered corporation wholly owned by a federally recognized Indian tribal government.  Those not required in 2012 may choose to voluntarily comply this year and could be required in future years but the IRS will give at least six months of advance notice of any changes to the transition relief.

In general, the amount reported should include both the portion paid by the employer and the portion paid by the employee whether or not it was pre-tax.  In the case of a health FSA, the amount reported should not include the amount of any salary reduction contributions.

The cost of these health care benefits will be reported in Box 12 of the Form W-2, with Code DD.  It is listed for informational purposes only, and is not taxable.

The transition relief applies to the following:

  1. Employers who filed fewer than 250 Forms W-2 for the previous calendar year (employers who filed fewer than 250 W-2s for 2011 tax year) will not be required to report the cost of coverage on the 2012 W-2s.
  2. Multi-employer plans.
  3. Health Reimbursement Arrangements.
  4. Dental and vision plans that are not integrated into another group health plan or that give participants the choice of declining the coverage or electing it and paying an additional premium.
  5. Self-insured plans of employers not subject to COBRA continuation coverage or similar requirements.
  6. Employee assistance programs, on-site medical clinics, or wellness programs for which the employer does not charge a premium under COBRA continuation coverage or similar requirements; and
  7. Employers furnishing W-2s to employees who terminate before the end of a calendar year and request their W-2 before the end of that year.

Employers are not required to create a W-2 for the sole purpose of reporting health coverage.

Click Here for more detailed information on this topic.

 Legal Disclaimer: This article is intended for informational purposes only and by no means should replace or substitute other legal documents (governmental or non-governmental) reflecting similar content or advice. If you have any questions concerning your situation or the information provided, please consult with an attorney, CPA or HR Professional.

W2 Reporting of Employer Paid Insurance

Monday, January 30th, 2012

W2 Reporting of Employer Paid InsuranceReporting the employer paid insurance on employee W-2s is voluntary for all employers for 2011 and small employers for 2012.  However, employers with more than 250 W-2s for tax year 2012 will be required to report the employer paid insurance amounts on all employees’ W-2s, due to the Affordable Care Act.

In general, the amount reported should include both the portion paid by the employer and the portion paid by the employee whether or not it was pre-tax.  In the case of a health FSA, the amount reported should not include the amount of any salary reduction contributions.

The cost of these health care benefits will be reported in Box 12 of the Form W-2, with Code DD.  It is listed for informational purposes only, and is not taxable.

For W-2s filed for the 2011 calendar year, employers are not required to report the value of health benefits provided, although they may do so voluntarily. For years after 2011, employers generally are required to report the value of health benefits provided on the Form W-2. Transition relief is available for certain employers and with respect to certain types of coverage.  Reporting for these employers is not required until future guidance is provided. The transition relief applies to the following:

  1. Employers filing fewer than 250 Forms W-2 for the previous calendar year (for example, employers filing fewer than 250 2011 W-2s) will not be required to report the cost of coverage on the 2012 Forms W-2
  2. Multi-employer plans
  3. Health Reimbursement Arrangements
  4. Dental and vision plans that are not integrated into another group health plan
  5. Self-insured plans of employers not subject to COBRA continuation coverage or similar requirements
  6. Employers furnishing Forms W-2 to employees who terminate before the end of a calendar year and request a Form W-2 before the end of that year

Employers are not required to create a W-2 for the sole purpose of reporting health coverage.  Click Here for more detailed information on this topic.

Legal Disclaimer: This article is intended for informational purposes only and by no means should replace or substitute other legal documents (governmental or non-governmental) reflecting similar content or advice. If you have any questions concerning your situation or the information provided, please consult with an attorney, CPA or HR Professional.