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Home » Clarion » 2013 » March 2013 » Health Insurance and Your W-2: New Information Is Listed

Health Insurance and Your W-2: New Information Is Listed

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The federal health reform law – the Patient Protection and Affordable Care Act (ACA) – requires that employers begin reporting the cost of employer-sponsored health insurance coverage on employees’ W-2 forms. Federal guidelines say that the purpose is “to provide employees with useful and comparable consumer information on the cost of their health care coverage.”

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For CUNY employees, that figure should appear in Box 12 of your W-2 form, with figure Code DD to identify the amount. The most important thing to know about this information is that it does not affect your taxes.

While there is a provision of the ACA that, as of 2018, will impose an excise tax on high-cost employer-provided plans, this will be a tax on the employer, not the employee. So whatever figure appears in Box 12 of your W-2, your tax bill will be unchanged.

In any case, the vast majority of PSC members have coverage that will be well below the threshold for these so-called “Cadillac plans.” While lower limits were proposed and debated as the ACA worked its way through Congress, a plan is currently considered to be in this high-cost category if its price tag exceeds $10,200 annually for individual coverage or $27,500 for family coverage. This amount is indexed to inflation, using the Consumer Price Index.

Taxes Unchanged

For CUNY employees, the amount shown in Box 12 includes the cost of your basic health insurance, prescription drug coverage and other benefits you may have through the PSC-CUNY Welfare Fund. Since these are group plans, where premiums for some aspects of coverage are not assessed on a strict per-capita basis, some components of this figure represent a prorated calculation rather than a precise per-person cost.

As April 15, 2013 draws nearer, you can expect to hear more discussion – and misinformation – about the health-coverage cost figure in Box 12 of your W-2. The most important thing to remember, and to share with others, is that it doesn’t matter whether this figure is $3 or $30,000 – your taxes remain unchanged.


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