Employers across the country have been preparing to meet the new W-2 reporting requirement under the Affordable Care Act, that generally requires employers to report on Form W-2 for tax years beginning with 2011 the cost of health coverage provided to the employee. In Notice 2010-69, the IRS has provided employers with another year to comply.
Specifically, this notice provides that reporting the cost of such coverage will not be mandatory for Forms W-2 issued for 2011 (i.e. for 2011 earnings). The relief was provided in order to give employers additional time to make any necessary changes to their payroll systems or procedures in preparation for compliance with the reporting requirement. Thus, an employer will not be subject to any penalties for failure to report such amounts on its employees’ Forms W-2 for 2011. The Treasury Department and the IRS anticipate issuing guidance on the reporting requirement before the end of 2010.