Health Care Coverage Reporting Requirement Delayed Until 2012

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On October 12, the Internal Revenue Service announced that reporting the cost of an employee’s coverage under an employer-sponsored group health plan on Form W-2 will not be required for Forms W-2 issued for 2011. After receiving input from APA and other payroll stakeholders, IRS determined that the relief is needed to provide employers with more time to make any necessary changes to their payroll systems or procedures to prepare for complying with the reporting requirement. Read IRS Notice 2010-69.

At the same time, IRS issued a draft version of the 2011 Form W-2 with a note on the back of Copy B stating that employers who wish to report the cost of employer-provided health insurance for 2011 should do so in Box 12 with new Code DD. The form also shows shading in Box 9, which is being reserved because it will no longer be used to report the Advance Earned Income Credit, which is eliminated effective January 1, 2011.

Source: American Payroll Association

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