Interim Relief for Employers

Brought to you by Insurance Center of New England, Inc.

Interim Relief for Employers
Form W-2 Reporting of the Cost of Group Health Insurance is Postponed

October, 2010 - Vol IX

Need More Information?

For more on Interim Relief for employers or questions regarding any of our previous Beyond Benefits topics, please contact Judy Davis at 750-7133.

For previous editions of our Beyond Benefits newsletters just go to our website, from the link provided icnegroup.com.

tax images On October 12, 2010, the Internal Revenue Service (IRS) has issued Notice 2010-69, providing interim relief to employers regarding reporting the costs of group health plan coverage to employees (Notice 2010-69). Specifically the notice states reporting the cost of employer-sponsored group health plans on the Form W-2 will not be mandatory for 2011.

Background

Section 9002 of the Patient Protection and Affordable Care Act (PPACA), a component of the Affordable Care Act, added a provision to the Internal Revenue Code, Section 6051(a)(14), that requires employers to report the cost of employer-sponsored health coverage on employees' W-2s starting with taxable years beginning on or after Jan. 1, 2011.

Interim Relief

The IRS and the U.S. Treasury Department determined the relief is necessary to allow employers additional time to make the necessary changes to their payroll systems or procedures in order to comply with this rule. The notice states the reporting requirement will not be mandatory for W-2s issued for 2011. And employers will not be subject to penalties for failure to meet this requirement for the 2011 tax year.

The IRS also posted a draft 2011 Form W-2 on its site.

Employers may choose to report 2011 health care coverage costs to their employees and may do so in Box 12 using the code "DD."

The Treasury Department and the IRS anticipate issuing guidance on the reporting requirement before the end 2010.

Resources: http://www.irs.gov/pub/irs-drop/n-2010-69.pdf

Insurance Center of New England's Beyond Benefits is providing this reference as general information only. It is not intended to be legal advice.

Insurance Center of New England, Inc. is a regional independent insurance agency providing full-service commercial and personal insurance protection and group employee benefits programs. Based in West Springfield, MA as Insurance Center of New England, Inc. and in Gardner, MA as Heritage Insurance Agency, we have satellite locations in East Longmeadow, Danvers, Fitchburg, Lowell, Orange, Haverhill and Winchendon.

For additional information contact Judy Davis at (413) 750-7133 or jdavis@icnegroup.com.