Section 125 Programs
A WIN-WIN Opportunity
For the Employer and the Employee
Flexible Spending Accounts Premium Only Plans Cafeteria Plans
Today, more than ever, employers are trying to stretch their benefit dollars and employees are looking for new benefits that can add to there take home pay. Section 125 programs answer that need and provide a win-win situation for all parties. The three programs outlined below serve to:
q Increase an employees take home pay by decreasing taxable income.
q Reduce an employer’s payroll taxes by reducing taxable payroll.
q Reduce the real cost of medical care and dependent care.
q Increase an employee’s flexibility in selecting their employee benefits.
Section 125 Programs stretch benefit dollars for employees by providing a tax savings program that translates into increased take home pay. For Employers, these same programs reduce their overall tax burden and provide a low cost or no cost valuable employee benefit. The employer’s benefits package becomes more competitive in the job marketplace and increases employee satisfaction and morale. That is why Section 125 Programs create a WIN-WIN for both the employer and employee.
The programs outlined below may be implemented individually or as a combination of benefits, but any one program can produce benefits to both the employer and employee. Each of these programs is easy to implement and easy to administrate.
Each Section 125 program is explained in greater detail below and there are illustrations and worksheets for both employers and employees to determine their actual tax savings. Take the time to save money! Learn about Section 125 programs.
Flexible Spending Accounts or FSAs