Employers Without a Section 125 Plan Miss Out on HUGE TAX Benefits
If you still haven’t augmented your company’s benefits program with a Section 125 Premium-Only Plan, you are missing out on substantial cost savings – and so are your employees.
A Section 125 POP Plan is often referred to as a cafeteria plan. You probably already know that a cafeteria plan allows employees to select from a range of benefit choices, such as health, dental, vision, or disability insurance, and then pay for those benefits through payroll deductions. But you may not know the plan’s biggest benefit – its tax-advantaged status.
Those payroll deductions are made pre-tax, which means that they reduce the employee’s taxable income. This, in turn, reduces the employee’s FICA and Medicare payroll taxes. The lower taxable income also means lower payroll taxes for you, the employer. You also enjoy lower FUTA taxes, and your state payroll taxes could also be lower. Depending on the employees personal tax bracket many participants see tax savings of up to 49-50% on premiums run through the Section 125 plan. Employers on avg. save 8.45% in FICA and FUTA savings and could be much higher depending on your state and county tax savings and/or workers compensation premiums. You can check out the tax savings for you and your employees at our site http://www.taxfreepremiums.com/WhyUse.aspx
Don’t Let Compliance Requirements Scare You
Even if you know the potential benefits of a Section 125 POP plan, you may have chosen not to establish one because of fear of the IRS. Yes, it’s true that IRS rules for cafeteria plans are complex, but following them doesn’t have to be difficult if you use a service like www.taxfreepremiums.com.
Log on today and we’ll generate plan documents customized for your business that you can use immediately. We’ll retain an electron copy of these documents, too, so they will always be available if you need them.
Your plan document needs to be kept up-to-date, but our site makes it easy to make change or update based on company changes whenever you needed. So, should you ever make changes, move offices, or make changes in administrative staff, updating your document is a snap. We also offer a step by step guide of necessary steps once the plan document is complete including providing the software for annually-required nondiscrimination testing that makes it easy to keep your plan in compliance with these important rules. Best of all, you don’t have to burden your employees with the work of staying up-to-date with IRS rules. Whenever there’s a change you need to know about, we’ll update your document and send signature ready amendments. No need to worry, we’ve got you covered.
All of this expertise and support is available to you for just $99 a year! It’s time to give your employees something they can really use – and give your company cost savings in the process!