A Cafeteria Plan, also known as a Section 125 plan (the IRS rule section), allows employees to pay for specific benefits on a pre-tax basis. Doing so means that employees have more take home pay, and employers pay less in matching payroll taxes - a true win-win for employees and emplo...
a section 125 plan, often known as a cafeteria plan, enables you to increase employee benefits without going over budget because of its considerable tax savings.
Section 125 plans must be created by an employer. The benefits are available to employees, their spouses, and their dependents when a plan is created. Depending on the circumstances and details of the plan, Section 125 benefits may also extend to former employees but the plan cannot exist prim...
The Tax Reform Act of 1978 added Section 125 to the Internal Revenue Code. Any plan governed by this code section is properly called either a Section 125 plan or a cafeteria plan. It is usually best for single employer plans to avoid including a 401(k) plan as part of a cafeteria plan...
Section 125 cafeteria plan training, Section 125 regulations, cafeteria plan administration, flexible spending account regulation, flexible spending account administration.
You can define a variety of taxable and nontaxable benefits when establishing a Section 125 Cafeteria Plan for your organization using the Elements task. For the Pretax Deductions primary classification, the following secondary classifications are eligible for section 125 cafeteria plans....
contribute a portion of your gross income before any taxes are calculated and deducted. Plans normally include options such as insurance benefits and benefits that help with various life events such asadoption. A cafeteria plan is also referred to as a flexible benefits plan or Section 125 plan....
A Section 125 cafeteria plan is governed by Section 125 of the Internal Revenue Code and allows employees to pay for certain benefits on a pre-tax basis. These benefits can include health insurance premiums, flexible spending accounts (FSAs) for medical and dependent care expenses, dental and vi...
A Section 125 Cafeteria Plan is an employer-sponsored benefit plan that allows employees to choose from a menu of taxable and non-taxable benefits. These benefits may include health insurance, dental insurance, vision coverage, flexible spending accounts (FSAs), and other qualified benefits. The te...
The plan offers a simple way to obtain favorable tax treatment for benefits already offered. Most companies currently have this set up through their payroll provider. A POP plan is the simplest type of Section 125 plan and requires little maintenance once it's been set up through your payroll...