Section 125 & Cafeteria Plans
Employer Strategies and Solutions to Substantially Reduce:
- the high cost of Health Insurance;
- the cost for Out-of-Pocket Medical Expenses;
- the cost for Dependent Day Care Expenses;
- the cost for Parking and Transit Expenses;
- cost of Self-Employed Healthcare Expenses;
- Employer Matching Payroll Taxes by 8%;
- Employee Income Taxes by 30%.
The IRS Code has numerous provisions designed to help employers provide essential benefits to their employees tax-free. This saves the employee approximately 30% in income taxes on expenses they're already paying for, and because the employees have reduced their taxable income, the employer realizes a reduced matching payroll tax liability of approximately 8%. Everybody saves money.
To take advantage of these tax deductions the IRS requires that the employer have a written plan document and the Department of Labor and ERISA law require that every employee receive a summary plan description (SPD) explaining the new benefit in easy to understand language.
This site is dedicated to providing employers with the tools they need to successfully establish these written plans with SPDs at the lowest cost possible. Please don't hesitate to call us if you have questions, we will be happy to assist you. Thank you.
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