May Tidbits
Reporting Employer Provided Health Coverage
The Affordable Care Act requires employers to report the cost of coverage for an employer-sponsored group health plan on an employee’s Form W-2 in Box 12. Beginning in 2012, many employers are eligible for transition relief until the IRS issues their final reporting requirement.
The amount reported does not affect tax liability since it is not taxable. This reporting is for informational purposes only; to show employees the value of their health care benefits so they can be more informed consumers.
More information about the reporting can be found on the IRS website Form W-2 Reporting of Employer-Sponsored Health Coverage.
New Health Insurance Premium Tax Credit
Starting in 2014, insurance purchased through the Affordable Insurance Exchange offers individuals and families a new premium tax credit to help them afford health insurance coverage. Affordable Insurance Exchanges will operate in every state. Taxpayers who have little or no income tax liability can still benefit because the premium tax credit is refundable. If necessary, the credit also can be paid in advance to the insurance company to help cover the cost of premiums for the taxpayer. On May 18, 2012, the IRS issued final regulations which provide guidance for individuals who enroll in qualified health plans through Exchanges and claim the premium tax credit, and for Exchanges that make qualified health plans available to individuals and employers.
Individuals will be offered a choice of health plans that meet certain benefit and cost standards by the Exchanges. The requirements for the Exchanges and the health plans they offer will be administered by The Department of Health and Human Services (HHS).
Small Business Health Care Tax Credit
This new credit (for tax years 2010 through 2013) helps small businesses (maximum credit is 35%) and small tax-exempt organizations (maximum credit is 25%) afford the cost of covering their employees and is specifically targeted for those with low to moderate-income workers. Beginning January 1, 2014, an enhanced version of the credit will become effective. The credit is designed to encourage small employers to offer health insurance coverage. Small businesses that pay at least half the cost of single coverage for their employees may be eligible for this credit. To learn more, go the IRS website Small Business Health Care Tax Credit for Small Employers.
Important Date
Second quarter federal estimated tax payments for individuals, trusts, and calendar-year corporations are due by June 15th. NH BET estimated payments are also due.
