IRS Issues Updated Guidance on W-2 Health Care Reporting

The U.S. Internal Revenue Service (IRS) has issued Notice 2012-9 to provide additional guidance on the informational reporting to employees of the cost of their employer-sponsored group health plan coverage on Form W-2.  It clarifies certain types of coverage that are exempted from reporting, and gives direction on calculation methods.  This informational reporting is required under Section 6051(a)(14) of the IRC, enacted as part of the Affordable Care Act of 2010. 

250+ W-2 Forms

As reported in previous articles, employers that are required to file more than 250 2011 Forms W-2 will be required to comply with this new reporting requirement beginning with 2012 Forms W-2 (due to employees and SSA by end of January 2013). 

Less than 250 W-2’s

Employers filing fewer than 250 W-2s in 2011 continue to be exempted from this new requirement until further guidance is issued by the IRS. 

Voluntary reporting

Any employer size can report health care costs on W-2’s voluntarily in 2011, and guidance is provided in Notice 2012-9 should the employer chose to do so.