W-2 forms now must include medical premium amounts

Wayne Pettigrew, senior consultant with Group & Pension Planners Inc., discusses new W-2 premium reporting requirements under the Affordable Care Act.

Q&A with Wayne Pettigrew

2012 W-2 forms must include

Wayne Pettigrew is owner and a senior consultant with Group & Pension Planners Inc.

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amounts for medical premiums

Q: Under the Affordable Care Act, employers are required to include the medical premium amount paid for an employer sponsored group medical plan on the employee's W-2 form for the 2012 tax year. Will employees be taxed on the value of these benefits?

A: No. The requirement to include these amounts is for informational purposes only and there is no provision in the ACA to tax these benefits as income. The IRS website states that “this reporting is for informational purposes only and will provide useful and comparable consumer information on the cost of health care coverage.”

Q: I understand there's some confusion among employers and carriers over the requirement.

A: Many initially thought that the requirement only applied to employer-paid premiums but the IRS website recently stated the employer and employee portion of any premium paid toward an employer-sponsored plan should be included. Therefore, even plans in which the employer does not contribute need to include the employee premiums paid.

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