W2 Health Insurance Reporting

[Jeff]

Part of the health care law changes are going to require that employers report W2 the total cost of healthcare for an employee on their W2. These changes are optional for 2011 W2s and optional for 2012 W2s for small employers (less than 250 W2s). Here is more information from the IRS: http://www.irs.gov/newsroom/article/0,, ... 70,00.html

We could implement this a few different way in PowerChurch and I am looking for your feedback:

1. This information is entered during the W2 process by changing the W2 after it is generated by PowerChurch.

2. Add information to the employee screen to enter the healthcare costs either by month or year

3. Change payroll items and create a healthcare employer item for the employer portion of healthcare with each paycheck. This would not effect the check amount. But would you want this to 1) post a liability in fund Accounting or 2) not have any accounting effects and just use the amounts for W2 reporting.

Which option seems the most logical to you? Thanks in advance.

[JohnDMeyers]

On choice 3, option 2, what report would show the accrued amount prior to running the W2s?

[NeilZ]

Part of the health care law changes are going to require that employers report W2 the total cost of healthcare for an employee on their W2. These changes are optional for 2011 W2s and optional for 2012 W2s for small employers (less than 250 W2s). Here is more information from the IRS: http://www.irs.gov/newsroom/article/0,, ... 70,00.html

We could implement this a few different way in PowerChurch and I am looking for your feedback:

1. This information is entered during the W2 process by changing the W2 after it is generated by PowerChurch.

2. Add information to the employee screen to enter the healthcare costs either by month or year

3. Change payroll items and create a healthcare employer item for the employer portion of healthcare with each paycheck. This would not effect the check amount. But would you want this to 1) post a liability in fund Accounting or 2) not have any accounting effects and just use the amounts for W2 reporting.

Which option seems the most logical to you? Thanks in advance.

We already have a payroll item for liability for pension and medical, we could separate them and have one accumulate for W-2 reporting, so I like option 3.

[tborgal]

I really don't think there is a one size fits all here. If the employee is paying all of the premiums themselves and having them withheld, what Neil suggests would be fine. However if the church is paying some or all of the premiums it might not be the best way. The option to enter the data manually once the W2 has been generated would still be a good one to have.

[NeilZ]

I understand where Tom is coming from. Perhaps I wasn't as specific as I should have been. The pay item I have currently is for the church liability of the combined Medical and Pension we send to the PC(USA)'s Board of Pensions, which handles all that.

I also have a pay item for my wife's contribution to the dental plan, which is deducted and put in a separate liability account.

As far as reporting, perhaps the option, much as is done with Housing Allowance, to print the total of a pay item in the correct box; along with the current option of manually editing the generated W-2 ?

[Jeff]

In any case you will be able to edit the complete W2 just as you can know. I am just trying to determine what is going to be expected. My concern with creating a payroll item is that since is does not normally appear on a paycheck, people are not going to set that up at the beginning of the year. When it comes time to do W2s what are they going to expect to get these numbers into the program.

[NeilZ]

In any case you will be able to edit the complete W2 just as you can know. I am just trying to determine what is going to be expected. My concern with creating a payroll item is that since is does not normally appear on a paycheck, people are not going to set that up at the beginning of the year. When it comes time to do W2s what are they going to expect to get these numbers into the program.

Well, we use it to make sure that the money is moved from the expense into the liability. Its considered part of the pastor's pay package, though non-taxible, so we just figured we'd cover it in this manner.