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W-2 REPORTING FOR GROUP HEALTH PLANS,
DEFERRED FOR SMALL EMPLOYERS
Earlier this month, the Internal Revenue Service (the "IRS") issued Notice 2011-28, which provides interim guidance regarding employers' obligations to report on Form W-2 the value of employer-provided health coverage. Under the Patient Protection and Affordable Care Act (the "Affordable Care Act"), this requirement was to be effective for tax years beginning in 2011, but was deferred until tax years beginning in 2012. Click for more information on the prior deferment.
In addition to offering detailed guidance on many topics, including but not limited to, methods for reporting the cost of coverage, the types of coverage for which the cost is required to be reported, how to calculate the aggregate cost of coverage, and how to handle employees' mid-year employment transitions, Notice 2011-28 postpones this reporting obligation for at least another year for designated "small employers." For this purpose small employers are those entities that for 2011 will issue fewer than 250 Forms W-2. Therefore, "smaller employers" are relieved from tracking and reporting the value of the group health care coverage on Forms W-2 until further guidance is issued, which will be effective no earlier than the due date of the 2013 Forms W-2.
Nukk-Freeman & Cerra will update you when additional guidance is issued. In the interim, if you have any questions regarding this reporting requirement or any other requirements of the Affordable Care Act, please feel free to contact Liza Hecht (lhecht@nfclegal.com), Christine Gottesman (cgottesman@nfclegal.com) or the Nukk-Freeman & Cerra, P.C. attorney with whom you work.
Any tax advice included in this written or electronic communication was not intended or written to be used, and it cannot be used by the taxpayer, for the purpose of avoiding any penalties that may be imposed on the taxpayer by any governmental taxing authority or agency.
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