Effective in tax year 2012, employers are required to report the aggregate cost of employer-sponsored health coverage on Form W-2.
► Box 12, code DD is used for this purpose
► The requirement to report employer-sponsored health coverage costs is informational only
► Amounts reported in Box 12, Form W-2 are not also included in employees’ taxable income (for now)
► Until the issuance of further guidance, an employer is not subject to the reporting requirement for a calendar year if the employer was required to file fewer than 250 Forms W-2 for the preceding calendar year.
Terminated employees
► An employer may apply any reasonable method of reporting the cost of coverage for an employee who terminated employment during the calendar year, so long as the method is used consistently for all employees covered under the plan.
► An employer is not required to issue a Form W-2 reporting the aggregate reportable cost of insurance to a terminated employee who requests the Form W-2 within 30 days of severance.
► Successor employer
► If an individual transfers to a new successor employer, generally both the predecessor and successor employers must report the employer-sponsored group health plan coverage that each provided, unless the successor reports using the alternate procedure (Revenue Procedure 2004-53).
► Box 12, code DD is used for this purpose
► The requirement to report employer-sponsored health coverage costs is informational only
► Amounts reported in Box 12, Form W-2 are not also included in employees’ taxable income (for now)
► Until the issuance of further guidance, an employer is not subject to the reporting requirement for a calendar year if the employer was required to file fewer than 250 Forms W-2 for the preceding calendar year.
Terminated employees
► An employer may apply any reasonable method of reporting the cost of coverage for an employee who terminated employment during the calendar year, so long as the method is used consistently for all employees covered under the plan.
► An employer is not required to issue a Form W-2 reporting the aggregate reportable cost of insurance to a terminated employee who requests the Form W-2 within 30 days of severance.
► Successor employer
► If an individual transfers to a new successor employer, generally both the predecessor and successor employers must report the employer-sponsored group health plan coverage that each provided, unless the successor reports using the alternate procedure (Revenue Procedure 2004-53).