One of the most underused employee benefits for small businesses today is the Section 125 Cafeteria Plan. These plans simply allow employees to withhold a portion of their salary on a pre-tax basis
to cover the cost of qualifying insurance premiums, medical expenses and dependent care expenses. Because Section 125 Cafeteria Plan benefits are free from federal and state income tax, an employee’s taxable income is reduced which increases take home pay. And because the Section 125 Cafeteria Plan reduces employee gross income for purposes of income tax, the employer also enjoys a reduction in their payroll tax liability.
Want to add to the Cafeteria plan benefit by giving the employee a predetermined amount to use for any of those categories, that can be arranged as well.
To be able to offer a plan, you must have a Summary Plan document which complies with all the current regulations as set forth by the government.
For more information regarding this coverage, email Jerri Wildhaber or call 800-944-7550.