diff --git a/flag.module b/flag.module
index eefd815..a94620a 100644
--- a/flag.module
+++ b/flag.module
@@ -938,7 +938,6 @@ function flag_entity_view($entity, $type, $view_mode, $langcode) {
     $entity_id = $flag->get_entity_id($entity);
     if ($flag->show_as_field) {
       $entity->content['flag-' . $flag->name] = array(
-        // ARGH needs extra wrapping!
        '#markup' => $flag->theme($flag->is_flagged($entity_id) ? 'unflag' : 'flag', $entity_id),
       );
     }
@@ -1486,6 +1485,7 @@ function flag_theme() {
         'action' => NULL,
         'entity_id' => NULL,
         'after_flagging' => FALSE,
+        'needs_wrapping_element' => TRUE,
         'errors' => array(),
       ),
       'template' => 'flag',
@@ -1535,6 +1535,7 @@ function flag_theme() {
  * - $entity_id
  * - $after_flagging
  * - $errors
+ * - $needs_wrapping_element
  *
  * See 'flag.tpl.php' for their documentation.
  */
diff --git a/theme/flag.tpl.php b/theme/flag.tpl.php
index df6bfdc..9bc2b2c 100644
--- a/theme/flag.tpl.php
+++ b/theme/flag.tpl.php
@@ -27,6 +27,8 @@
  *   flagged. If displaying to the user immediately after flagging, this value
  *   will be boolean TRUE. This is usually used in conjunction with immedate
  *   JavaScript-based toggling of flags.
+ * - $needs_wrapping_element: By default is true. Determines if flag displays a
+ *   wrapping element or not.
  *
  * Template suggestions available, listed from the most specific template to
  * the least. Drupal will use the most specific template it finds:
@@ -38,6 +40,9 @@
  */
 ?>
 <span class="<?php print $flag_wrapper_classes; ?>">
+  <?php if ($needs_wrapping_element) : ?>
+  <p>
+  <?php endif; ?>
   <?php if ($link_href): ?>
     <a href="<?php print $link_href; ?>" title="<?php print $link_title; ?>" class="<?php print $flag_classes ?>" rel="nofollow"><?php print $link_text; ?></a><span class="flag-throbber">&nbsp;</span>
   <?php else: ?>
@@ -48,4 +53,7 @@
       <?php print $message_text; ?>
     </span>
   <?php endif; ?>
+  <?php if ($needs_wrapping_element) : ?>
+  </p>
+  <?php endif; ?>
 </span>