The Facts: How to Create a Tax-Deductible Employee Wellness Program

How To Get Started

To create a structured, Tax-Deductible Employee Wellness Program that includes Massage,

you must consult a team of specialized professionals  -due to the complexity of IRS guidelines, tax laws, and compliance regulations. 

The key professionals to consult are:

1. Tax Advisor / CPA

A qualified tax advisor or Certified Public Accountant (CPA) is crucial for navigating IRS regulations (such as those in IRS Publication 502) and ensuring your program qualifies as a legitimate business expense. 

Role: 

They will determine how to structure the program so the costs are deductible for the business, and the benefits are potentially non-taxable for the employees (if possible, as most wellness incentives are generally taxable).

Action: 

Consult with them on the specifics of recording expenses and reporting incentives on employee W-2 forms. 

2. Legal Counsel / Employee Benefits Attorney

An attorney specializing in labor and employment law, particularly employee benefits, is necessary to ensure the program complies with various federal laws. 

Role: 

They ensure compliance with the Affordable Care Act (ACA), the Americans with Disabilities Act (ADA), the Health Insurance Portability and Accountability Act (HIPAA), and the Employee Retirement Income Security Act (ERISA).

Action: 

Legal counsel should review all program documentation, communications, and consent forms to minimize risk and ensure legal compliance. 

3. Third-Party Benefits Administrator or Benefits Consultant

These specialists help design and manage the program within a compliant framework, such as a Section 125 cafeteria plan, if appropriate. 

Role: 

They can provide expert guidance on structuring the wellness initiative to integrate with existing health plans and optimize tax advantages while staying current with changing laws.

Action: 

They can help ensure that the program's incentives are structured correctly and documented meticulously for an audit. 

4. Wellness Program Provider or Consultant AKA Ritual Massage Therapy

For the practical implementation of the massage program itself, a specialized wellness provider can assist. 

Role: 

They help design the specific activities, manage the logistics (e.g., bringing licensed massage therapists on-site), and provide data for evaluating the program's effectiveness and return on investment.

Action: 

They can provide documentation, such as a recommendation from a qualified provider, that specific services are part of a legitimate wellness or medical program, which is helpful for tax purposes. 

By coordinating with these professionals, you can develop a comprehensive, legally sound, and tax-efficient employee wellness program.

Make massage therapy your tax-deductible workplace ritual.