The Business Case for Financial Wellness in the Workplace

Employee Financial Wellness Stats

Source: 1) The MetLife Study of Financial Wellness Across the Globe: A look at how multinational companies are helping employees better manage their personal finances – Conducted by the Boston College Center for Work & Family from 2011. 2) Help Wanted? Employees and Financial Wellness Programs – Study conducted by LIMRA 2015.

Financial Wellness for Employees: It matters.

Inside the widespread uncertainty of a pandemic, comes the sudden urgency to plan and protect the things we may have previously pushed aside. For many, that includes personal financial wellness. And if you’re a business owner, that means you need to pay attention.

Now more than ever, employees are looking for your support as they navigate the future for themselves and their families. You might be surprised to know that financial wellness plays a major part in an employee’s overall job productivity and company loyalty. See stats below…

During a time when you need to keep you business afloat with confident employees, if you haven’t already offered access to financial resources and education, you can start now and do it all virtually.

Our team offers a customized Financial Wellness Series as an employee benefit to small business owners. It’s a simple setup that shows you are serious about employee appreciation and building value inside your work environment.

Here is an example of how we conduct our program and how it would look if you decide to take this time as an opportunity to do more good for your employees.

We follow a 3 Step Enrollment Process:

  • 1st – Our team will survey your employees based on dozens of financial topics to find which they collectively find most interesting.
  • 2nd – We will collaborate with you on the best time and frequency of each wellness session – available in person and via video conference.
  • 3rd – Our team will evaluate your employee satisfaction following each presentation, in order to consistently improve your experience.

Some of the topics we’ve received the most positive feedback on are:

  • Wealth Creation
  • Financial Goal Setting
  • Investment Basics
  • Planning for College
  • Predictable Income in Retirement
  • Protecting Your Income
  • Retirement Readiness
  • Understanding Stock Options & Strategies
  • Understanding Your Group Benefits
  • +Customized Presentations For Your Company

There has never been a more important time to take a step back and focus on doing what we can for each other as a community, neighbors, colleagues and employers. As we have always encouraged business owners to offer financial wellness, we do the same today but with an extra emphasis during this time of crisis, and because it just makes sense. If you’d like to discuss options to bring to your employees we’re here to talk.

Source: 1) The MetLife Study of Financial Wellness Across the Globe: A look at how multinational companies are helping employees better manage their personal finances – Conducted by the Boston College Center for Work & Family from 2011. 2) Help Wanted? Employees and Financial Wellness Programs – Study conducted by LIMRA 2015.

Tax Benefit Checklist for Families Caring for Children with Special Needs

2019 Tax Year

We’re providing below a checklist created by Thomas M. Brinker, Jr., LL.M., CPA Professor of Accounting | Arcadia University.  This is a great resource for double-checking your own circumstances against some key IRS provisions. This is general guidance and may not apply exactly to your situation. Make sure you talk to your own tax professional about how these apply to your family. 

Deducting the cost of a Special School or Institution

  • What is a special school?
    • Schools with programs to “mainstream” children with neurological disabilities (i.e., autism spectrum disorders)
  • What is deductible?
    • Lodging
    • Meals
    • Transportation
    • Incidental educational costs provided by the institution
    • Costs of supervision, care, treatment, and training
  • When can regular schools be classified as a “special school” for an individual?
    • Where School has special curriculum for neurologically disabled individuals
  • Private tutoring by a specially trained teacher
    • Therapeutic and behavioral support services (see Revenue Rulings 70-285 and 78-340)
  • Special education for children with dyslexia
    • Provided program enables children to deal with disability caused by medical condition (2005’s Letter Ruling 200521003)

Deduction for Medical Conferences and Seminars

  • Both transportation and conference fees deductible (per Revenue Ruling 2000-24)

Special Diet Foods

  • Generally, only the cost of special diet food over and above normal food (i.e., the premium; see Revenue Rulings 2002-19 and 55-261)

Prescribed Vitamin Therapy; Hyperbaric Oxygen Therapy; Chelation Therapy; Equestrian Therapy; Individualized or Group Art, Dance, Music, and Play Therapies; Summer Camps, etc.

Medical Travel and Transportation

  • For 2020 tax returns: 17 cents per mile (20 cents per mile for 2019)
  • Lodging costs (but not meals) up to $50 per day per person are deductible for the Taxpayer (TP) and one additional person if an overnight stay is necessary

Note: Un-reimbursed Medical Expenses are deductible only to the extent the TP itemizes their deductions (Schedule A) and they exceed 7.5% of adjusted gross income (AGI) as of 2020 (7.5% of AGI for 2019 was restored retroactively under the Taxpayer Certainty and Disaster Tax Relief Act of 2019).

Consider a FSA (Flexible Spending Account) Health Care Plan if ineligible for medical expense deduction!

  • The maximum pre-tax contribution is $2,750 for 2020 ($2,700 for 2019)

Impairment Related Work Expenses

  • Business deduction in lieu of a medical deduction for attendant care services at place of employment (ordinary and necessary expense to help in performing job)
  • Avoids AGI limitation imposed on un-reimbursed medical expenses

Expanded definition of a “qualifying child”

  • An individual with special needs can be older than 19 or 24 and qualify as a “dependent” for 2020 and 2019
  • No gross income limitation for a “qualifying child” (The “gross income” limitation applies to a “qualifying relative” and is $4,300 for 2020 and $4,200 for 2019….review ALL requirements!)

Note: Personal and Dependency Exemptions have been suspended (reducing the exemption amounts to zero) under 2017’s Tax Cuts and Jobs Act for 2018 through 2025. However, the definition of a dependent is still key for other deductions and credits such as the expanded child ($2,000) and dependent credits ($500). The Tax Cuts and Jobs Act increased the child tax credit from $1,000 to $2,000 per child and increased the refundable portion of the credit to $1,400. The Act provides a $500 nonrefundable credit for a qualifying dependent other than a qualifying child (i.e., a 17 year old child or a parent).

Credit for Special Needs Adoption Expenses

  • $14,300 for a child with special needs in 2020 ($14,080 for 2019)…regardless of adoption expenses
  • An eligible child is an individual who is under the age of 18, or is physically or mentally incapable of self-care
  • Must be a U.S. citizen or resident and requiring adoption assistance as determined by state authorities
  • Qualifying expenses include: legal fees, court costs, and other related adoption costs
  • The limit is per child, not per year (The credit is non-refundable with a carryover of 5 years)
  • Credit is phased-out for taxpayers with adjusted gross income exceeding $214,520 for 2020 ($211,160 in 2019)
  • The credit is completely phased-out at $40,000 above the threshold
  • The credit is claimed in the year the adoption becomes finalized regardless of actual expenses paid or incurred in the year the adoption becomes final for a “special needs” adoption.

10% Penalty Exception for Retirement Plan and Individual Retirement Account (IRA) Distributions

  • 10% penalty does not apply to a distribution that is less than or equal to the allowable medical expense deduction on Schedule A (regardless of whether the individual actually itemizes deductions) if the distributions are used to pay for the medical care during the year.
  • Penalty waiver only applies to taxable amount of the distribution. The income tax still applies to the taxable component of the distribution.

This handy checklist was created by: Thomas M. Brinker, Jr., LL.M., CPA Professor of Accounting | Arcadia University