W-2 Reporting: How is the benefit calculated for an eligible employee who changes benefit levels during the year?

The amount reported on the W-2 will be prorated to reflect the change the employee made during the year. 

Example: Employer provides a QSEHRA with a self-only permitted benefit of $3,960 and a family permitted benefit of $8,040. John Employee enrolls in self-only coverage from January 1 through July 31 and in family coverage from August 1 to December 31. 

On the W-2, the employer reports a permitted benefit of $5,660 (($3,960 x 7/12) + ($8,040 x 5/12)).