Section 125 Plans
Give yourself and your employees an instant tax cut with an employee group benefit plan that offers multiple options. EasyChoice offers Premium Only Plans (POP) and Flexible Spending Account Plans (FSA) to help you and your staff save money.
POP gives you and your employees a way to save money while fostering employee loyalty and retention. POPs qualify for payment with tax-free dollars, which can save employees up to 40% and eliminate nearly 8% of employer-paid matching FICA and federal unemployment tax payments.
FSAs enable you to develop a range of pre-tax benefits options, including dependent care, medical expense and commuter expense reimbursement plans:
- Dependent care: Give employees who pay for senior or dependent child care a tax break with a qualified dependent care FSA. Employees can choose to deduct up to $5,000 per year in pre-tax dollars to pay for eligible dependent expenses, significantly reducing their tax liability.
- Medical expenses: Provide a way for employees to pay for eligible medical expenses with a qualified medical FSA. Employees can choose to deduct tax-free funds to pay for expenses not covered by traditional insurance plans, including copayments, deductibles and coinsurance as well as certain over-the-counter medications, dental and vision benefits.
- Commuter costs: Help employees beat the high cost of commuting with a plan that allows them to set aside up to $205 a month for mass-transit expenses and as much as $105 per month for work-related parking costs.
The savings you and your employees get from EasyChoice pre-tax benefits plans can really add up: For example, an employee with an annual salary of $30,000 can reduce their taxable income to $27,600 by contributing $2,400 to an account to pay for routine expenses. That can result in a $736 increase in take-home pay.
Your company also takes advantage of potential savings: For a 10-person firm with $300,000 annual payroll and 7.65% Social Security taxes, nearly $2,000 in savings is possible if enough employees sign up and taxable payroll is reduced. It’s a win-win situation for you and your staff – an easy choice.