Employer-Provided Health Coverage Not Taxable Starting in tax year 2011, the Affordable Care Act requires employers to report the value of the health insurance coverage they provide employees on each employee's annual Form W-2. This reporting is for informational purposes only, to show employees the value of their health care benefits so they can be more informed consumers. The amount reported does not affect tax liability, as the value of the employer contribution to health coverage continues to be excludible from an employee's income and it is not taxable.
I would have no problem if company paid health insurance were taxable. It would level the playing field for the self employed, who...if they purchase HI...do so with taxed income.
“...as the value of the employer contribution to health coverage continues to be excludible from an employee’s income and it is not taxable.”
...for now. This is just a way to “ease into it” and get the payroll/taxing systems modified.