Section 125 Pre-tax benefit plans

 

Offering your employees a Pre-Tax option is a great way to boost satisfaction with your overall benefits package and reduce your tax burden with minimal overhead! Whether you want to offer Healthcare Savings Accounts, Flexible Spending Accounts, or traditional benefits with a pre-tax deduction, don’t run afoul of the IRS by neglecting the record keeping requirements! Schedule a meeting with one of our Pre-Tax experts today to see how easily you can take advantage of this great tax incentive!

 

Flexible Benefit Plans

Tax Savings For You and Your Employees

Health Savings Accounts

Dependent Day Care Accounts

Commuter Benefit Accounts

  Flexible Spending Accounts

 

What are flex accounts? Sometimes referred to as flexible spending accounts, cafeteria plans, Section 125 plans or flex plans, flex accounts let employees set aside a portion of each paycheck into an account—before paying income taxes. During the year, employees are reimbursed from this account for expenses such as health care, dependent day care and commuting fees. Reimbursements for qualified expenses are tax-free. How will my employees save money? The portion of salary which an employee directs to the plan is not taxed. The employee saves: „ Federal income tax. „ State and local taxes (where applicable). „ Social Security tax (assuming the employee’s salary is below the maximum Social Security wage base). Employees will save 25% to 40% in taxes for every dollar they elect. What happens to the money an employee puts into a flex plan? The employee’s redirected salary is “banked” in an account maintained for the employee. Qualified expenses incurred by the employee are reimbursed tax-free from dollars “banked” in the account. Who can sponsor a flex plan? Regular corporations, partnerships, S corporations, limited liability companies (LLCs), sole proprietors, professional corporations and not-for-profits can all save money on taxes by establishing a flex plan. While Regulations prohibit a sole proprietor, partner, members of an LLC (in most cases) or individuals owning more than 2% of an S corporation from participating in the flex plan, they may still sponsor a plan and benefit from the savings on payroll taxes. “Employee” shareholders of regular corporations may also participate.

  Healthcare Account Options

 

FSA—Flexible Spending Accounts allow employees to set aside a portion of their paychecks (before taxes) into an account to budget for expenses not covered by another health plan. The participant can use the account to pay for prescribed over-the-counter (OTC) medicines,1 co-pays at the doctor or pharmacy, chiropractic care, eyeglasses, contacts, LASIK, orthodontics, and more. HSA—Health Savings Accounts allow employees to set aside a portion of their paychecks (before taxes) into an “IRA-like” custodial account to save for future medical expenses, or pay current expenses not covered by another health plan. To contribute to an HSA, the employee must also be covered by an IRS qualified high-deductible health plan. Employers may contribute to employees’ HSAs. Unlike FSAs, unused funds can be carried forward to the future and/or invested. HSAs are also portable and can be taken to a new employer or used at retirement. An HSA can also be coupled with a “limited” FSA that pays for vision or dental expenses that are not covered by another plan. Day Care Account Options Child Day Care Accounts. Employees set aside pre-tax payroll deductions in this account to budget for the day care expenses of a dependent child under age 13. Elder Care and Adult Day Care Accounts. Employees set aside pre-tax payroll deductions to budget for the expenses of a dependent adult who cannot physically or mentally care for themselves. Commuter Benefit Accounts Through payroll deduction, employees contribute to an account that saves 25% to 40% on the expense of parking near their place of employment and travel to and from work

  HRA/HSA

 

Health savings accounts (HSAs) and health reimbursement accounts (HRAs), provided by our carrier partners, allow you to offer HSA- and HRA-qualified health insurance policies to your employees. As an employer, any contributions you make on an employee’s behalf are not taxable, allowing for additional tax savings by lowering employee taxable income.

  Cobra Administration

 

If you have 20 or more employees, COBRA Administration can relieve you of the complexities and possible liability associated with COBRA compliance. Available through several of our partner carriers, COBRA Administration allows you to stay focused on your business.

  ACA Reporting/Compliance

 

One of the newest challenges facing employers today is compliance with the Affordable Care Act’s reporting requirement. Many small business owners aren’t even aware of the law’s impacts on their business, thinking they are small enough to be exempt. While some of the very smallest businesses can still carry on as they always have, many key components of the law taking effect in 2016-2018 will affect many small operations who are not expecting it! Don’t get caught unprepared, small and easy changes now can save you big at tax time. Schedule a meeting with one of our ACA specialists today to see how your business will be affected and what you can do to prepare. There is never a cost for the initial consultation. To schedule a 20 minute consultation over the phone

  Benefits Communications & Enrollments

 

Even if you offer the best benefits package in town, it brings you and your employees no benefit if your employees don’t understand how all the parts of it work. In a 2012 survey, nearly two-thirds (65%) of employees said they felt unprepared for benefits enrollment. Since that time, benefits have only gotten more complex, and employee confusion is at an all time high. Schedule a time to meet with one of our Benefits Consultants today, to learn how we can help you make sure your employees are getting the most value out of the dollars you spend on benefits!

  Payroll Services

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  Employee claims assistance

 

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Student Loan Paydown Program

Employers make a payment on behalf of their employee to help pay down their student loan principle.

*   Qualified Employees:  Employers set the guidelines based upon incentive goals or tenure to determine which employees qualify for this benefit.

*   Contributions: Employers determine how much they would like to contribute on behalf of their employees

*   Lifetime Maximum: Employers can set a lifetime maximum per employee

*   Frequency: Employer determine whether they would like to contribute on a monthly or annual basis

70% of employees have student loan debt

*   Average Student Loan Amount = $37,172

*   Average monthly payment = $382

*   40,000,000 Americans have student loan debt totaling $1,400,000,000

*data according to a study by www.debt.org/students

  Why employers like this benefit?

The Student Loan Paydown Program helps employers recruit top talent, retain key employees, and boost overall productivity. Millennials are notorious for job hopping and this benefit provides companies with a key differentiator when competing for the best and the brightest individuals. Further, employees feel as if their employer understands their needs and cares about their unique situation.

  Why employees like this benefit?

Studies have shown that employees who participate in these programs are more loyal and more likely to recommend their company to peers who are searching for jobs. This benefit can help reduce the payoff timeline by up to 3 years, which alleviates anxiety associated with debt and helps the employee focus on building their career and saving for retirement. Everybody wins.