The IRS recently released additional guidance on the Health Care Reform rules that require employers to report the total cost of employer-sponsored health care coverage on employees’ Forms W-2. For more information on the general provisions of these rules, please see our previous HRBenefits Authority, Health Care Reform Act: IRS Issues Guidance on W-2 Health Plan Reporting.
Transitional Relief. In 2011, Form W-2 reporting of the cost of employer-sponsored health care coverage was optional for all plans. For 2012 and beyond, (i.e., starting with Forms W-2 that must be distributed by January 2013 for calendar year 2012), employers are generally required to report the total cost of employer-sponsored health care coverage in box 12 of employees’ Forms W-2. However, an employer need not report the cost of health care coverage on the Forms W-2 of its employees who terminate employment during the calendar year and request a Form W-2 before the year is over.
Exempt Employers. The new IRS guidance clarifies that, until the IRS provides otherwise, employers that filed fewer than 250 Forms W-2 for the previous year are not required to report the cost of health care coverage on its employees’ Forms W-2.
Exempt Health Care Coverage. Additionally, the new IRS guidance provides that employers are not required to report the cost of the following types of health care coverage on the Form W-2:
- Coverage provided through a multiemployer plan;
- Health reimbursement arrangements (HRAs);
- Stand-alone dental or vision plans; and
- Employee assistance programs (EAPs) and wellness programs, but only if the employer does not charge a premium to employees who elect COBRA continuation coverage. (Remember that EAPs and wellness programs are considered group health plans under COBRA.)
Contact Information. For more information from Mazursky Constantine, please contact Amy Heppner (404.888.8825). For more information from VCG Consultants, please contact Leslie Schneider (770.863.3617).
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