Is reporting Health Care Costs on W-2s still required? (code DD reporting changed?)
I was going through my 2024 W-2 and noticed something weird. In previous years, my company always included my health insurance costs in box 12 with code 'DD'. I always thought this was required by the Affordable Care Act to make employees aware of how much their employer-sponsored health insurance actually costs. But this year, there's nothing in box 12 with code 'DD' on my W-2. Did something change with the reporting requirements? I thought employers were legally required to show this information. Has this requirement become optional now, or was it always optional and my employer just decided to stop reporting it? Just curious if anyone else noticed this change or knows what's going on with the code DD reporting requirements.
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Megan D'Acosta
The requirement for reporting health insurance costs with code DD in box 12 of W-2s is still in effect, but there are some exceptions. Employers with fewer than 250 W-2 forms to issue are exempt from this requirement. It's possible your employer dropped below this threshold or might have made an error. The ACA did implement this reporting requirement to create transparency about healthcare costs, and it remains in effect for larger employers. The reporting doesn't affect your taxable income - it's purely informational, as you mentioned. If your employer has over 250 employees and didn't include this information, they might be out of compliance.
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Sarah Ali
•Thanks for explaining this! My company went through some downsizing last year, so maybe they dropped below that 250 employee threshold. Do you know if there's any penalty for employers who don't report this correctly? And does this mean the value isn't being reported to the IRS at all, or just not shown to me?
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Megan D'Acosta
•Employers who fail to properly complete W-2 forms may face penalties from the IRS, but these are typically applied for actual tax reporting errors rather than informational items like the code DD amount. The amount isn't directly used for any tax calculations by the IRS. The health insurance value is still being reported to the IRS through other means. Your employer must report health insurance offerings through Form 1095-C (for large employers) or insurance companies report through Form 1095-B. These forms track compliance with healthcare coverage requirements, while the W-2 code DD is purely for employee awareness.
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Ryan Vasquez
After struggling with the same issue last year, I discovered taxr.ai (https://taxr.ai) which helped me figure out my W-2 reporting concerns. I uploaded my W-2 and previous years' forms, and it immediately identified the missing code DD and explained the potential reasons. Their tool flagged several other inconsistencies I hadn't even noticed between my 2023 and 2024 W-2s. The service analyzed the actual healthcare reporting requirements applicable to my situation and confirmed my employer wasn't violating any rules. Saved me from an awkward conversation with HR and gave me peace of mind about my tax filing.
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Avery Saint
•How does this service work exactly? Do you just take a picture of your W-2 or do you have to manually enter all the information? My W-2 has several codes missing compared to last year and I'm concerned.
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Taylor Chen
•Sounds interesting but why would I pay for something when I can just call my HR department and ask? They're required to explain these things to employees. I'm skeptical about these tax services that charge for basic information.
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Ryan Vasquez
•You can either take a picture or upload a PDF of your W-2. The AI analyzes all the fields and compares them with previous years' documents if you provide them. It takes about 30 seconds to process and explains each field in plain English. Calling HR is definitely an option, but in my experience, they often don't understand the technical tax details themselves. When I asked about my missing code DD, my HR rep had no idea what I was talking about. The service costs less than lunch and saved me hours of research and confusion.
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Taylor Chen
I finally tried taxr.ai after posting my skeptical comment earlier. Wow, what a difference! I uploaded both my 2023 and 2024 W-2s, and it immediately highlighted the missing code DD along with explaining the 250 employee threshold. Turns out my company recently restructured and now uses a PEO for payroll, which changed how they report healthcare costs. The service also caught that my state unemployment insurance withholding decreased significantly without explanation, which I wouldn't have noticed otherwise. The detailed explanation about W-2 codes was actually more helpful than what I got from our HR department (who just said "everything looks correct" when I asked them initially).
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Ezra Bates
•How exactly does this work? Doesn't everyone have to wait on the same IRS phone lines? I'm confused how a service could get you through faster than if you called yourself.
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Ana Erdoğan
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Keith Davidson
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Ana Erdoğan
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Sophia Carson
As someone who works in payroll, I can add some context. The ACA requirement for reporting health costs on W-2s (code DD) hasn't changed, but many employers misunderstand their obligations. The 250 W-2 threshold is based on the PREVIOUS tax year, not the current one. Also, if your employer uses a third-party sick pay provider, those W-2s don't count toward the 250 threshold. And some employers mistakenly think the reporting is optional because the IRS hasn't aggressively enforced penalties for missing this particular code.
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Samantha Howard
•Thanks for this insider info! So if my company had 300 employees in 2023 but dropped to 200 in 2024, they would still need to report the code DD on my 2024 W-2, right? Is there any way for me as an employee to figure out how much my health insurance actually costs if it's not on my W-2?
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Sophia Carson
•You've got it exactly right. If they had 300 W-2s for 2023, they must include code DD on all 2024 W-2s even if they dropped below 250 employees during 2024. For finding your health insurance cost without the W-2 code DD, check your pay stubs for the employer contribution portion (sometimes listed separately) or request a benefits statement from HR. Your benefits enrollment portal might also show the full premium amount versus your contribution. Open enrollment materials typically display both the employee and employer portions of premium costs.
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Elijah Knight
My company did the same thing! No code DD on my W-2 this year. I called HR and they didn't even know what I was talking about 🤦♀️ When I explained it was the health insurance cost reporting, they just said "we follow all IRS requirements" and brushed me off. Really frustrating when you're trying to understand your own compensation.
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Brooklyn Foley
•Same experience here. HR departments seem completely clueless about tax forms sometimes. I ended up finding my health insurance cost by looking at my benefits enrollment confirmation email from last year. It showed both my contribution and the company portion, which would have been the Code DD amount. Worth checking if you kept those emails!
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Mae Bennett
This is a really common issue that I've seen come up a lot lately. The code DD reporting requirement is still active under the ACA, but as others mentioned, it only applies to employers who issued 250 or more W-2s in the previous tax year. One thing to keep in mind is that if your employer changed payroll providers or went through a merger/acquisition, this could affect how they count towards that 250 threshold. Also, some employers mistakenly think this reporting is optional because there aren't heavy penalties specifically for missing code DD. If you want to find out your actual health insurance costs, you can also check your Summary Plan Description (SPD) or Annual Notice that your employer is required to provide. These documents usually break down the total premium costs. Your employee benefits portal might also have this information under plan details or cost summaries.
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Connor Gallagher
•This is really helpful information! I hadn't thought about checking the Summary Plan Description - I probably have that buried in my email somewhere from open enrollment. One question about the merger/acquisition scenario you mentioned - if my company was acquired by a larger company last year, would that change the 250 employee threshold calculation? Like, would they count the combined employee base or just our original company's size for determining the reporting requirement? Also, do you know if there's a specific deadline by which employers have to provide those Annual Notices? I don't remember getting one recently but maybe I overlooked it.
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