The IRS issued a draft Form W-2 for 2011. The IRS also announced that it will defer the new requirement for organizations to report the cost of coverage under an employer-sponsored group health plan. It is optional for employers to report this information in 2011.
The draft Form W-2 includes the codes that organizations may use to report the cost of coverage under an employer-sponsored group health plan. The Treasury Department and the IRS have determined that this relief is necessary to provide employers with adequate time to make changes to their payroll systems or procedures in preparation for compliance with the new reporting requirement (Notice 2010-69). The IRS will be publishing guidance on the new requirement later this year.
Although reporting the cost of coverage will be optional with respect to 2011, the IRS continues to stress that the amounts reportable are not taxable. As part of the Affordable Care Act (ACA), the new reporting requirement is intended to be informational only, and to provide employees with greater transparency into overall health care costs.
For more information on how healthcare reform may affect your organization, visit Healthcare Reform: A Resource Center for Employers.