| Employer Sponsored Groups - Products |
|
Section 125
Section 125 is an Internal Revenue Code tax reduction tool for employees and employers. Ranging in scope from Premium Only Plans (POP) to Flexible Spending Accounts (FSA) to full Cafeteria Plans, Section 125 allows the employee to decrease the amount of taxes paid, thereby increasing net income. Due to the reduced taxable income, the employer will also realize a savings in the FICA match.
- PREMIUM ONLY PLAN - The premiums paid by the employee for group health and various other eligible benefits are payroll deductible on a pre-tax basis.
- FLEXIBLE SPENDING ACCOUNT - Qualified dependent care expenses and expenses for certain medical related care are payroll deductible on a pre-tax basis. Examples of eligible medical expenses are co-payments, deductibles, coinsurance, and vision and dental expenses that are not covered by insurance or other sources. The Premium Only Plan is generally packaged with the Flexible Spending Account.
- CAFETERIA PLAN - The employer provides a set amount of money and a menu of benefits, and each employee selects those benefits that best fit their needs. A full cafeteria plan incorporates the Premium Only Plan and Flexible Spending Account with other employer sponsored benefits.
|
|
 |
|
