"DD" / W-2 / Box 12

[Black Bart]

Never saw this before this year. What exactly is the new thingamajig supposed to do for us?

It says "Cost of employer-sponsored health coverage," but...whose cost? Employer paid, employee paid, combined payments of both, a recap of what used to be listed on a paycheck stub, a result of impending Obamacare, or....what?

[dkss]

Black Bart -
that there figure is just there to look purty and make ya go hmmm....healthcare sure is 'spensive.

It is there for information only. I think it is a combo of both employer and employee costs.

[ChEAr$]

So I looked it up in the W2 preparation instructions from IRS, and you'd think it would be defined there.
But NO........! Just says the "cost" and doesn't define whose cost.
Maybe we can find it on the irs.gov page.

[Burke]

dkss is correct. You don't need to do a thing with it. I like to point it out to the client, however, so he is aware of how much his health insurance is costing. It is combined cost -- employer and employee (if he pays anything.)

[AZ-Tax]

What exactly does this amt consist of?

What exactly does this amt consist of? Is it the combined amt the employee paid in premium with the amt the employer paid on behalf of the employee?

[DaveO]

We will be looking for that when we become the health insurance cops in 2014. There will be a new due diligence form for us to complete with a healthy fine if we fail to. When the cost overruns inherent in the new law materialize then that is the amount upon which the extension of tax to health benefits provided by the employer will be based. At least that’s what I’m telling people, I could be wrong.

[Gene V]

Here is a previous discussion on DD

http://forum.thetaxbook.com/showthread.php?21390-Health-Insurance-on-W-2&highlight=gene

[FEDUKE404]

Seeing the future

We will be looking for that when we become the health insurance cops in 2014. There will be a new due diligence form for us to complete with a healthy fine if we fail to. When the cost overruns inherent in the new law materialize then that is the amount upon which the extension of tax to health benefits provided by the employer will be based. At least that’s what I’m telling people, I could be wrong.

I can hear it now:

"Are you SURE you know what you're doing?? My refund has never been that small!!"

FE

[DaveO]

I have found that if I base my predictions on the worst possible outcome I'm seldom wrong. When I am, the client is happy with me about it.

[Black Bart]

Black Bart - that there figure is just there to look purty and make ya go hmmm....healthcare sure is 'spensive...

Thanx dk, thass jus' whut I figgered -- and as the other fellers and felleresses said, the cost is rilly sump'n.

And thanx for the link, Gene. Apparently ever'body's got a theory, but I'm like Harlan (grin) -- I'm goin' straight to the guv'mint about it: I'm callin' 1-800-829-1040 (not much question but what that temp will gimme the inside dope).

[John of PA]

This DD information is supposed to be the employer's portion of the health insurance paid. IRS is starting to get this complience going with the W-2 disclosure becasue under the new Health Care Law, Cadilac health plans (probably thats anything more than an HMO) are taxable to the employee (the excess plan cost over a basic HMO plan). So this is becoming a taxable benefit in the near future 1-1-14. Perhaps compliance will be extended or delayed, lets hope so.

[Bonnie]

I have used it this year just for my own knowledge of who has health care and who does not. I also point out to the customer what it means. So far out of 100 returns I've prepared, I have found 2 who do not have health care coverage. So I explained to them what will happen next year if they don't get some coverage. This gives them a heads up so it's not total shock if I prepare their taxes next year and have to tell them they are getting this big penalty on their tax return which reduces their refund. I'd rather my customers be prepared ahead of time.

[geekgirldany]

I thought the penalty is for TY 2014... I know the exchanges are suppose to open in October 2013.

[mactoolsix]

I thought the penalty is for TY 2014... I know the exchanges are suppose to open in October 2013.

Yep - begins with tax year 2014 filing in 2015. Smaller penalties for TY 2014 & 15 - look out in 2016. Of course by then everything will have changed for "something better"

Mike