Unfortunately, tax season is rarely the most wonderful time of the year for human resource professionals as they provide employees the necessary documents to report annual compensation to the Internal Revenue Service (IRS). Employee benefit consultants can ease companies' tax burdens, offering information and resources they can use to handle W-2 reporting changes in 2013.
Companies will be required to report the cost of employer-sponsored insurance coverage on a W-2 form, including amounts paid to the business and the employee in 2013. The cost includes employer-sponsored coverage from a group health plan, but does not affect an employee's gross income. The IRS requests federal, state and local government agencies, religious organizations and employers not subject to the Consolidated Omnibus Reconciliation Budget Act (COBRA) to include this information when issuing W-2 forms to employees. Failure to include the coverage data could result in IRS fines and penalties.
Employers providing W-2 forms to at least 250 employees will be required to report the total cost of group health benefit plan coverage on W-2 forms, according to the Patient Protection and Affordable Care Act. The change takes effect when 2012 W-2 forms are distributed to workers in January 2013. Workers will receive information on W-2 forms if they elect coverage and pay medical care premiums. In addition, employer-provided coverage will not be subject to income tax as the IRS made the change for informational purposes only.
IRS regulations may change annually, but organizations can use employee benefit consulting companies to keep them updated on tax modifications. Consultants offer solutions that help human resource supervisors address employee concerns. In addition, the benefit professionals give businesses the tools they need to provide employees accurate W-2 information in a timely fashion.
