[StBernard] IRS: W-2 reporting on 2011 health costs is optional

[Westley Annis]

IRS: W-2 reporting on 2011 health costs is optional
By WebCPA Staff
October 13, 2010

The Internal Revenue Service has released a draft Form W-2 for 2011, which
employers use to report wages and employee tax withholding.

The IRS also announced Tuesday 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 by employers optional in 2011.

The draft Form W-2 includes the codes that employers 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 the time they need to make changes to their
payroll systems or procedures in preparation for compliance with the new
reporting requirement. 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 said it continues to stress that the amounts reportable are
not taxable.

Included in the Patient Protection and Affordable Care Act passed by
Congress in March, the new reporting requirement is intended to be
informational only, and to provide employees with greater transparency into
overall health care costs.