Insights

HIA FINANCIAL

W-2 Reporting

PPACA requires employers to report the cost of coverage under an employer-sponsored group health plan on an employee’s Form W-2, “Wage and Tax Statement.” This reporting is for informational purposes only to show employees the value of their health care benefits so they can be more informed consumers.Many employers were eligible for transition relief for the 2012 tax year until the IRS issued final guidance for this reporting requirement. The amount reported doesn’t affect tax liability, as the value of the employer excludible contribution to health coverage continues to be excludible from an employee’s income, and it’s not taxable.