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A Section 125 Cafeteria Plan, also known simply as a cafeteria plan or a flexible benefits plan, is a type of employee benefits plan governed by Section 125 of the Internal Revenue Code in the United States. It allows employees to choose from a menu of pre-tax benefits, similar to ...
Define Section 125 Plan. Section 125 Plan synonyms, Section 125 Plan pronunciation, Section 125 Plan translation, English dictionary definition of Section 125 Plan. n. a fringe-benefit plan under which employees may choose from among various benefits tho
What is a Section 125 Health Insurance Plan? A Section 125 (or cafeteria) plan is offered by employers that provide employees with taxable and nontaxable benefits before tax. Section 125 plans offer employees the option of receiving cash payments or employee benefits. An employee who takes the ...
Who Needs a Section 125 Plan? Pre-taxed employee benefits are required by the IRS. Yes, a Section 125 plan document is required if you’re an employer that wants to permit salary deductions from employees’ pre-tax wages to be used to pay for group health as well as other insurance prem...
B. Dowd, R. Feldman, and M. Maciejewski, "The Effect of Internal Revenue Code Section 125 on Health Plan Choice," Contract no. M-1451.0 (Institute for Health Services Research, School of Public Health, University of Minnesota, 1995)....
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....
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A Section 125 plan typically lets employees use pretax money to pay forhealth insurancepremiums for medical, dental, and vision. Other options include retirement deposits, supplemental life or disability insurance, Health Savings Accounts, and various medical or dependent care expenses. ...