W-2 Health Cost Reporting Delayed One Year
Good news for employers and payroll administrators! According to an IRS News Release posted earlier this week, employers will have an additional year to comply with the Affordable Care Act requirement to show total healthcare costs on the W-2. Originally, this requirement was to begin with 2011 W-2’s, but now the employer has the option to either begin reporting in 2011, or can wait until 2012 with no penalties. The IRS has issued a draft 2011 Form W-2 showing how the W-2 will look for next year’s wages. This will give employers and payroll providers more time to ensure that payroll systems are set up properly to comply with this requirement.
See my previous article Prepare Your Payroll System – Health Costs Reported On W-2s in 2011 for more information about this requirement. The IRS expects to issue further guidance on this reporting requirement before the end of the year for employers who do choose to report in 2011.