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Executive Summary: The IRS has issued Notice 2012-9, which restates and amends its previously issued interim guidance (Notice 2011-28) on the requirement that employers report information regarding the cost of employer-sponsored group health plan coverage.
The Patient Protection and Affordable Care Act of 2010 ("PPACA") added Section 6051(a)(14) to the Internal Revenue Code of 1986, as amended (the "Code"), requiring that the aggregate cost incurred by an employer for employer-sponsored health coverage provided to an employee be reported on the employee's Form W-2, for informational purposes, for taxable years beginning on or after January 1, 2011.
On January 3, 2012, the IRS issued Notice 2012-9, amending its previously issued guidance on informational reporting (Notice 2011-28) and adding additional provisions.
Notice 2012-9 clarifies that:
Notice 2012-9 also addresses several new issues, including:
The new guidance reiterates that employers are not required to report the amount of a health FSA offered through a § 125 cafeteria plan if contributions occur only through employee salary reduction elections, and provides a new example illustrating this provision.
Notice 2012-9 also provides that, until further guidance is issued, the reporting requirement will not apply to tribally chartered corporations wholly owned by federally recognized Indian tribal governments. Additionally, it clarifies the application of the reporting requirement to certain related employers not using a common paymaster.
Notice 2012-9 is applicable to 2012 Forms W-2 (that is, forms required for calendar year 2012, which will be filed in early 2013). Employers may also rely on the guidance provided in Notice 2012-9 if they if they voluntarily report the cost of coverage on 2011 Forms W-2 (filed this month), even though such reporting is not required for 2011.
According to the Notice, the transition relief it provides will be available at least for 2012 Forms W-2 and will not be affected by the issuance of further guidance. Any future guidance that limits the availability of transition relief provided by Notice 2012-9 will be prospective only and will not be applicable earlier than January 1 of the calendar year beginning at least six months after the date of issuance of the guidance.
If you have any questions regarding this Notice or about the Act's reporting requirements, please contact any member of Ford & Harrison's Employee Benefits practice group or the Ford & Harrison attorney with whom you usually work.
You may also visit the health care reform section of the Ford & Harrison website, http://www.fordharrison.com/HealthcareReform.aspx, for more helpful resources and tools on health care reform.
 Under Notice 2010-69, reporting was made optional for the 2011 calendar year. For more information on that Notice, please see our October 18, 2010 Legal Alert, Do Employers Need to Report the Amounts that They Pay for Employees' Health Insurance?, available at: http://www.fordharrison.com/shownews.aspx?Show=6690.