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Exceeding Expectations. Always. — Business Advisors and CPAs

New Reporting Rule for Form W-2

For 2012 all employers, who filed more than 250 W-2s in 2011,  must show the gross value of the employee’s health insurance on the 2012 W-2, if the coverage is provided by the employer in a group health plan. The amount shown should be BOTH the amount paid by the employer and employee.  This is so the employee can shop around for cheaper insurance. The cost does not include amounts the employer might pay for long-term care, disability income insurance, coverage under a qualifying separate dental or vision policy, or workers' compensation.
 
The gross value of an employee’s health insurance coverage should be calculated using the COBRA applicable premium method, premium charges method or modified COBRA premium method.  IRS Notice 2012-9 gives examples of each of these methods.  If we can help you in deciding which is the best method for you to use, please give us a call.