The Patient Protection and Affordable Care Act of 2010 (the Act)1 requires employers that sponsor group health coverage to report to employees the aggregate cost of such coverage annually on their Form W-2 (Wage and Tax Statement). The Act’s W-2 reporting requirement applies generally to employer-provided coverage without regard to whether the premiums are paid by the employer, the employee, or both, and without regard to whether the cost of coverage is includable in the employee’s taxable income. The W-2 reporting requirement appears in newly added Internal Revenue Code § 6051(a)(14), which was originally slated to take effect in 2011. But IRS Notice 2010-69 2  provided that W-2 reporting would not be mandatory until issuance of the 2012 W-2s.

In Notice 2011-28,3 the IRS furnished initial guidance under the Act’s W-2 reporting requirement. Recently issued Notice 2012-9,4 which restates and expands on Notice 2011-28, provides employers and plan sponsors with some important clarifications. As was the case with Notice 2011-28, Notice 2012-9 makes clear that the Act’s W-2 reporting requirement is informational. As Notice 2012-9 explains it:
“Nothing in [Internal Revenue Code] § 6051(a)(14), this notice, or the additional guidance that is
contemplated under § 6051(a)(14), causes or will cause otherwise excludable employer-provided
health care coverage to become taxable.”

This client advisory reviews the key provisions of Notice 2012-9 and explains what employers will
need to do to be ready to comply.

Please see full article below for more information.