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IRS Announces Employers Offering Caregiver Support Benefits - like Mellie - are Tax Exempt.



More than 21% of employees juggle work and caregiving responsibilities for aging relatives and/or children with special needs.



In the evolving HR environment, a key constant is the importance of prioritizing employee wellbeing. A supportive workspace where employees can address their personal and professional challenges with empathy and practical solutions is a vision that is now more achievable. A significant leap in this direction is the recent IRS and Treasury Department's announcement regarding work-life referral programs.


Understanding Work-Life Referral Programs

Work-life referral programs offer a broad spectrum of informational and referral consultations designed to assist employees in navigating personal, work, and family challenges. These programs encompass a wide array of services that aim to empower employees with the necessary resources to excel in their personal and professional lives.


Benefits of Work-Life Referral Programs

Work-life referral programs not only comply with the IRS guidelines but also bring several benefits to the table. They help in creating empathetic work environments where employees feel genuinely supported. Such programs can significantly impact productivity, absenteeism, and retention in the workforce. By prioritizing employee wellbeing, employers can invest in a happier and more engaged workforce, creating a win-win for all.


IRS Clarification on Work-Life Referral Programs

The recent IRS and Treasury Department announcement has brought a significant change to the tax treatment of work-life referral services. According to the IRS, caregiving benefits offered through work-life referral programs can be excluded from income and employment taxes. This tax exemption further encourages employers to include such programs in their employee benefits strategy.


Key Roles of Work-Life Referral Programs

Work-life referral programs play a crucial role in several aspects of an employee's life. These include:

  1. Identifying Appropriate Service Providers: These programs assist employees in identifying suitable education, care, and medical service providers.

  2. Choosing Care Programs: They help in choosing a suitable child or dependent care program.

  3. Navigating Government Benefits: They assist in understanding and navigating eligibility for government benefits, including Veterans Administration benefits.

  4. Locating Home Services: They assist in locating home services professionals who specialize in adapting a home for a family member with special care needs.

  5. Navigating the Medical System: They provide support in navigating the medical system, including private insurance and public programs, and utilizing available medical travel benefits.

  6. Connecting with Professionals: They help in connecting the employee with local retirement and financial planning professionals.


These services do not cover the costs of the underlying services such as daycare, medical care, or school tuition. However, they offer navigational and logistical support to employees, reducing the stress of caring for a loved one and enhancing their ability to balance the demands of work with family responsibilities.


The Mellie Solution

More than 21% of employees juggle work and family caregiving responsibilities for adult loved ones and/or children with special needs (AARP, 2020). At Mellie, we're passionate about revolutionizing the employee experience for family caregivers. Our all-in-one solution addresses the caregiving challenges that most impact productivity, absenteeism, and retention within the workforce.


By prioritizing employee wellbeing for family caregivers, you're investing in a happier, more engaged workforce, which in turn leads to increased productivity and retention – a win-win for everyone involved. To learn more about how Mellie can support your employee caregivers and wellbeing initiatives, visit www.mellie.com or reach out.

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