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IRS Defers Reporting Cost of Health Coverage on W-2's

The IRS Oct. 12 issued a draft Form W-2 for 2011, and the White House announced that it will defer the new requirement for employers...
October 19, 2010

The IRS Oct. 12 issued a draft Form W-2 for 2011, and the White House announced that it will defer the new requirement for employers to report the cost of coverage under an employer-sponsored group health plan, making that reporting optional in 2011.

According to a statement from the Treasury Department and IRS, the Administration has determined that employers may need time to make changes to their payroll systems or procedures in preparation for compliance with the new reporting requirement. The IRS will publish guidance on the new requirement later this year.

The draft Form W-2 does include the codes that employers may use to report the cost of coverage, though that reporting is not required until 2012. The White House also stressed this week that the amounts reportable are not taxable and that the reporting is intended to be informational only and to provide employees with greater transparency about overall health care costs.

"For months, opponents of health reform have falsely claimed that the Affordable Care Act would lead to the taxation of health care benefits," said Stephanie Cutter, President Obama's assistant for special projects, on the White House blog. "The claim wasn't true when the rumor first surfaced, it isn't true today and it won't be true tomorrow."


 

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