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January 17, 2024
Lyceum Insurance Services

Report Health Plan Costs on Form W-2

Unlock a healthier and financially empowered future with our groundbreaking approach to health plan reporting!

Certain US companies must report health plan costs on Form W-2. Employers must record group health plan costs on W-2 forms. This report informs employees about health care costs. 

Employees’ Form W-2, Wage and Tax Statement, Box 12, must include Code DD for employer-sponsored group health plan coverage costs under the Affordable Care Act. Transition relief is available for 2012 and beyond for many businesses until the IRS publishes final guidance on this reporting requirement. The employer must provide the W-2 form to the employee before January 31 each year so that they can file income taxes before the deadline (usually April 15).

Here are some of the key points in reporting Form W-2:

  • Applicable Employer-Sponsored Coverage –  includes health plans, dental and vision plans, and certain types of benefits that are provided by the employer.
  • Exclusions –  contributions to Health Savings Accounts (HSAs), Archer Medical Savings Accounts (MSAs), or long-term care insurance.
  • Aggregate Costs – total cost of the plan for the employee, including both the employer and employee contributions.
  • Form W-2, Box 12, Code DD – the cost of health coverage 

It’s important that employers to stay informed of the requirements and adhere to the IRS guidelines related to the reporting of the health plan costs of Form W-2. 

Consult a trusted firm to ensure compliance with current regulations. Join us on a journey of financial clarity and employee well-being as we redefine the narrative of health plan reporting in 2024. Your pathway to a smarter, more informed workplace begins here!

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