Total Articles: 7
IRS Revises Guidance on Form W-2 Informational Healthcare Coverage Reporting Under PPACA
On January 3, 2012, the IRS issued Notice 2012-9, which restates and amends prior interim guidance on the new requirement under the Patient Protection and Affordable Care Act (PPACA) that employers provide informational reporting to employees of the cost of their employer-sponsored group health plan coverage on Form W-2.
Recent Changes to Federal Tax Laws Affecting Employers
There are a variety of changes to federal tax laws as a result of recent legislation as well as triggers in long-existing legislation that impact employers, including repeal of withholding on payments to federal contractors, enhanced tax credits for hiring veterans, and increased federal unemployment tax rates resulting from states’ failure to repay federal loans.
Health Care Coverage and Form W-2
Late last month, the IRS issued guidance on how employers will report the aggregate cost of employer-sponsored health coverage provided to an employee on Form W-2. The Patient Protection and Affordable Care Act (PPACA) imposed the reporting requirement, originally effective for the 2011 Form W-2s (for issuance in 2012). However, an earlier IRS Notice postponed this reporting requirement until the 2012 Form W-2s (for issuance in 2013).
Employers Paying Severance Have Opportunity to Reduce FICA Taxes.
The current economic climate has caused many employers to institute reductions in force. In doing so, employers often provide their former employees with severance pay in an effort to soften the impact of unemployment. Normally, both the employer and the employee recipient incur taxes imposed by the Federal Insurance Contributions Act ("FICA")1 on these payments. However, it is possible for both employers and employees to reduce FICA taxes by structuring some or all of these severance payments as supplemental unemployment benefit payments ("SUB-Pay").
Publication 15, Circular E, Employer's Tax Guide [PDF File].
IRS tax publication. Includes general information regarding employer taxes, including determining employee status, taxes on wages, filing form 941, and FUTA.
Publication 15a, Employer's Supplemental Tax Guide [PDF File].
This publication supplements Circular E, Employer's Tax Guide. It contains specialized and detailed employment tax information supplementing the basic information provided in Circular E.
Publication 15b, Employer's Tax Guide to Fringe Benefits.
This publication supplements Publication 15, Circular E, Employer's Tax Guide, and Publication 15-A, Employer's Supplemental Tax Guide. It contains specialized and detailed information on the employment tax treatment of fringe benefits.
