SIMERPU RESEARCH · SOURCE RECAP
Wellness Indemnification Payments Includible in Employees' Taxable Income
SIMERPU recap and commentary: Mardy Gould
Opened — main text retrieved
Quick recap
Walks through CCA 202323006, separating income exclusion analysis from FICA, FUTA and withholding rules for monthly wellness indemnification payments.
SIMERPU’s viewpoint
This walkthrough helps distinguish the income-tax question from FICA, FUTA and withholding questions. SIMERPU would carry that separation into payroll implementation and employee education. A proposal is easier to evaluate when each payroll treatment has its own explanation and responsible party.
What this source contributes
The walkthrough separates income inclusion, employment taxes and withholding instead of compressing them into a single tax-free claim.
What remains unanswered
A payroll team still needs the correct treatment of its own payments and clarity about reporting and responsibility.
Mardy Gould’s take
I would want payroll involved before the first deduction is set up. Ask the team to explain every affected tax and reporting line using a sample pay statement. The provider’s explanation and the payroll instructions should agree, so the employer understands both the intended result and how it is being produced.
Questions I would bring to the conversation
1. Which tax and reporting lines change?
2. What supports each proposed exclusion or withholding treatment?
3. Who checks that the first payroll matches the explanation?
Mardy Gould · Co-Founder, SIMERPU →
What would change our assessment?
A verified payment classification and reconciled payroll instructions could resolve implementation questions; a payroll code by itself would not provide the rationale.
Read the original source
The original author and publisher are credited below. Continue to their article, document or source page for the complete context.
Original Author: Ed Zollars, CPA
Publisher: Current Federal Tax Developments
Original Publication Date: 2023-06-11
Read this alongside…
Each connection has a specific purpose. Compare the sources’ facts, positions and publication dates as you read.
CCA 202323006 — Tax Treatment of Employer-Funded, Insured, Fixed-Indemnity Wellness Policy
IRS Office of Chief Counsel
Source position: Neutral / explanatory
Read the memo’s separate income-tax and employment-tax discussions.
Read the SIMERPU recap →
CCA 201703013 — Tax Treatment of Benefits Paid by Fixed-Indemnity Health Plans
IRS Office of Chief Counsel
Source position: Neutral / explanatory
Compare the earlier contribution-funding scenarios.
Read the SIMERPU recap →
Short-Term, Limited-Duration Insurance and Independent, Noncoordinated Excepted Benefits Coverage
Federal Register
Source position: Neutral / explanatory
Check the later preamble before assuming a rulemaking change resolved payroll treatment.
Read the SIMERPU recap →
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About this source
Original Updated Date: 2023-06-11 (page metadata)
Source Type: Accounting / tax analysis
Model Discussed: Employer-funded fixed-indemnity insurance policy
Position: Neutral / explanatory
Period: Recent — 2023–2026
Retrieved: October 31, 2026
Research and date notes
Date and byline from source metadata.
Each record identifies the material retrieved. SIMERPU’s viewpoint and Mardy Gould’s take are editorial commentary; the source-position label describes the original source’s stance. Read the original and its qualifications when evaluating a particular arrangement.
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