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Phone: 215.997.5600 | Fax: 215.997.7218
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Health Care Coverage Now Reported on Your 2011 W-2s is Not Taxable

Dateline:  December 2011

The Affordable Care Act indicates that employers are now required to report the cost of employer-sponsored group health plan coverage on the Form W-2, Wage and Tax Statement.  This new reporting requirement is for information only, to inform you about the cost of your health coverage.  It does not mean that your employer-provided health care coverage is now subject to tax.

Some employers will report the cost in Box 12 of your 2011 Form W-2 using Code DD.  However, some employees may not see it yet since many employers are under "transition relief" and aren't required to report this amount on the W-2 until further notice from the IRS.  One of the forms of relief is specifically for smaller employers.  Any employer that files fewere than 250 Forms W-2 for 2011 (generally furnished in 2012) will not be subject to this requirement for 2012.

In news release IR 2011-31, the IRS issued interim guidance Notice 2011-28 that explained which employers are eligible for relief and how the informational reporting should be performed by employers subject to the requirement.  The IRS is also requesting comments on this interim guidance.

Notice 2010-69, issued last fall, made this requirement optional for all employers for the 2011 Forms W-2 (generally furnished to employees in January 2012).

You can see more information about this W-2 reporting and about other tax provisions in the Affordable Care Act on the ACA pages of IRS.gov.

The IRS is deferring the requirement for employers to report the value of your health insurance coverage on your W-2.  FInd out how and when it will be implemented by clicking here to watch the IRS video on YouTube.