Frequently Asked Questions

What has changed with the IRS Tax Laws to Provide Employers these Tax Breaks?

For almost 50 years, employers have utilized health insurance programs and deferred compensation programs to reduce payroll taxes and free up dollars for employees. This program combines those principles with the latest developments in wellness tax benefits to give savings back to companies and increase benefits to their employees.  The program is compatible with all major medical plans, HRA's, HSA's, FSA's, and all health/wellness plans already in place.  This can all be accomplished without affecting the employee’s net take home pay or adding cost to the company’s bottom-line.

On January 1, 2014, a new tax incentive was created by congress which now provides incentives to both employers and employees that participate in a participatory compliant wellness program.  It is the position of Congress, that education and participation in an approved compliant wellness program will lead to a reduction in the nation’s overall healthcare costs.

What Will This New Tax Savings Program Do For My Company?

Solid Solutions Advisory Group has partnered with industry leaders in participatory compliant wellness healthcare programs, to save employers an average of $500 to $800 per employee, per year.  This reduction takes effect on the first payroll run after plan implementation.  It is NOT an end of year tax deduction.  In addition, the plan provides additional benefits to employees with no reduction in the employee’s take-home-pay.

What is a Participatory Wellness Program?

Participatory Wellness Programs are programs that either do not provide a "reward" to employees or do not include any conditions for obtaining a reward that are based on an individual satisfying a standard that is related to a health factor.  In addition, participatory wellness programs must be made available to all similarly situated individuals, regardless of health status. Participatory Wellness Programs are not Health-Contingent Wellness Programs that require an individual to satisfy a standard related to a health factor to obtain a reward.

Is This Participatory Wellness Plan Considered a Health Plan?

Our current Participatory Compliant Wellness Program includes services that qualify as “medical care” and is considered a “health plan.” Our program involves “medical care” that is individualized and is provided by trained professionals. “Medical Care” is defined to mean amounts paid for: (a) the diagnosis, cure, mitigation, treatment, or prevention of disease, or amounts paid for the purpose of affecting any structure or function of the body, (b) amount paid for transportation primarily for and essential to medical care referred to in (a), and (c) amounts paid for insurance covering medical care referred to in (a) and (b). *This program does not satisfy the Minimum Essential Coverage (MEC) requirements for Major Medical Health Insurance under the Affordable Care Act (ACA).

Are All Company Employees Qualified To Participate In This Program?

• Employees must average working 30 hours per week or average 130 hours per month, consistently, to qualify for this program.

• Employees must be enrolled in a group or individual medical health plan either at work, with their spouse, and or in the open market.

• Employees that are receiving a subsidy through a State or Federal exchange are not eligible because it would mean double-dipping.

• Owners of the company, including their spouse and heirs, do not qualify for this program unless their share is 2% or less.  However, Owners of a C Corporation pay participate if theyare a W-2 employee of the corporation.

• Tipped only employees without a salary or hourly base, do not qualify for this program.

• Employees who are 1099 independent contractors do not qualify for this program.


How Does This Program Affect My Social Security Benefits?

Any pre-tax reduction in employee’s adjusted gross income will lower the amount of payments to Social Security. (Examples: Dental, Vision, 401K, group health insurance) to offset this reduction in Social Security, the Wellness Reserve Credits the program produces can be used to accumulate cash value that in almost all cases will provide greater retirement income and a higher level of security for the employee and for their family.

What Gives The Authority To Allow The Employee a “Wellness Reserve?”

This type of program, using Section 125 Pre-Tax Deductions for companies using a qualified Self-Funded Limited Medical Plan have been around for years.  This program provides a "Wellness Reserve", based on certain participation guidelines that employees may use to purchase ancillary products outside of this plan and pursuant to the company’s cafeteria plan. These products will not lower the employee’s take home pay.

Is the "Wellness Reserve" Taxable?

Our counselor specifically addressed this issue with the chief counsel of the IRS on the use of post tax dollars for ancillary products.  Claim payments that come from products purchased with post tax dollars have never been taxable.  

Why Haven't I Heard Of This Program Until Now?

It is estimated that over 90% of today’s employers have not been informed of these tax breaks utilizing this program.  Our objective is educating the business owners at large.