Background
The Affordable Care Act (ACA) added Internal Revenue Code (Code) section 6051(a)(14), which requires employers to report the aggregate cost of employer-sponsored group health plan coverage on their employees’ Forms W-2. This reporting requirement was originally effective for the 2011 tax year. However, the IRS later made reporting optional for 2011.
In April 2011, the IRS issued Notice 2011-28, which furthered delayed the Form W-2 reporting requirement for small employers and provided interim guidance on the reporting requirement. On Jan. 3, 2012, the IRS issued Notice 2012-9, which revised and clarified the IRS’s interim guidance on the Form W-2 reporting requirement.
Requirement
- Employer size for the purpose of the Form W-2 reporting requirement is based on Form W-2s issued in the prior calendar year
Small Employer
- Filed fewer than 250 Form W-2s in prior calendar year
- Form W-2 reporting requirement is optional for small employers, unless and until the IRS issues further guidance
Large Employer
- Filed 250 or more Form W-2s in prior calendar year
- 250 threshold in prior calendar year determines if requirement applies for current year
- for example, total 2013 Form W-2s (issued in 2014) was 250 or more, then reporting would be required for the 2014 W-2 forms (issued in 2015)
- 250 threshold is based on Form W-2s filed under company EIN
- in a Controlled Group situation (i.e. common ownership) each EIN could be counted separately
- 250 threshold in prior calendar year determines if requirement applies for current year
- Requirement became effective in 2012 for large employers
- for large employers that did not comply in prior years 2014, technically should provide corrected W-2s and fines could accrue until correct info is provided
- Section 6051(a) of the Code requires this information to be reported on Form W-2. An amended return, a Form W-2c, is required if an original Form W-2 fails to include the required information.
- for large employers that did not comply in prior years 2014, technically should provide corrected W-2s and fines could accrue until correct info is provided
More Information
For more information go to:
http://www.irs.gov/Affordable-Care-Act/Form-W-2-Reporting-of-Employer-Sponsored-Health-Coverage