The Internal Revenue Service (IRS) is informing taxpayers that costs associated with wellness, diet, and overall health are unlikely to be covered by Internal Revenue Code section 213 reimbursement for medical expenses. The IRS published a press statement and a list of commonly asked questions the IRS:
- explains the need that reimbursable medical costs be connected to a specified activity or course of treatment for a targeted condition.
- Warns employers about businesses that are misrepresenting the conditions under which a tax-favored plan can pay for or reimburse food and wellness expenses.
The IRS is worried that individuals might not be aware of the situations in which spending related to diet or wellness can qualify as medical costs. The IRS reminded people in a news release on March 6, 2024, that personal expenses cannot be reimbursed through FSAs, HSAs, or HRAs in a way that is tax-favored.
Employers should be wary of vendors who advertise pre-tax programs that use funds for wellness or nutrition-related costs. These vendors may offer to supply medical records for a fee in an effort to support their claims.
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