100 likes | 104 Vues
The Premium-only section 125 plan (POP), is a very common type of cafeteria plan, which allows employers to provide employee benefits in compliance with Section 125 of the Internal Revenue Code.u00a0More details visit https://www.aniarticles.com/1863-get-pro-assistance-24-7-on-premium-only-section-125-plan<br>
E N D
WelcomeTo Davidow Financial & Insurance Services, Inc.
Get Pro-Assistance 24*7 on Premium-Only Section 125 Plan Basically, a cafeteria plan allows employees to either: • Avail benefits like health insurance or life insurance on a pretax basis, or • Receive a comparable yet taxable—benefit in cash.
What is Premium-only section 125 plan POP? • This plan allows your employees to pay their insurance premiums with pretax dollars. • However, the plan isn’t actually insurance itself and you would still have to offer group health insurance separately. • This POP may include a “cash-in-lieu of benefits” provision for employees who don’t wish to have coverage under the group plan. • Employees who are enrolled in any other group health plan (like a plan from a spouse or parent) can opt to receive a fixed amount of cash instead.
Is health insurance pretax with a Premium Only Section 125 Plan POP? Yes, it is! As per the section, Employee contributions to group health insurance premiums are pretax as long as a Premium only Section 125 plan POP is in place. Or else, their contributions are taxed. However, Employer contributions are pretax always.
What are the benefits of a Section 125 POP? • Being able to pay for premiums using pretax dollars is the most exciting benefit for all employees, but it’s also a win for the employer as well. • The amount your employees contribute is deducted from their total wages, hence it reduces the amount of employee payroll taxes you are set to pay. • Premium Only Section 125 Plan POP isn’t just applicable to health insurance, either. • These cafeteria plan advantages can be applied to premiums for other group insurance products as well.
Is there any difference between a POP and a full Section 125 plan? With a POP plan, an employee is eligible for benefit premiums. Whereas health savings account (HSA) contributions can be made on pretax grounds. On the other hand, A full Section 125 plan also allows you to subtract eligible contributions to flexible savings accounts (FSAs); dependent child care on a pretax basis.
Are POPs subject to ERISA requirements? • Yes! Let us explain and provide you information on the same. • The Employee Retirement Income Security Act of 1974 (ERISA) refers to a federal law which sets minimum standards for most of the voluntary retirement and health plans. • Even though a POP is actually an ERISA plan, the benefits paid through it are. • The employer should be well informed that all reporting and disclosure requirements apply to every ERISA-covered benefits; for example, group health insurance, dental, and disability.
General ERISA requirements may include: • Summary plan descriptions of the plan • Well-Written plan documentation • Form 5500 filings for certain specified plans DF Insurance is a top notch financial institution providing world class solution for regulatory compliance requirements. We have a team of highly experienced professionals who provide exceptional assistance to all employers associated with us in saving up on group insurance plans with pre-tax dollars and also ensuring employees do not have to compromise on any health benefit coverage. Call us now at (877) 935-6744 – We are within your reach always!
Contact us Davidow Financial & Insurance Services, Inc. 20700 Ventura Blvd. Suite 235 City: Woodland Hills State: California Zip: 91364 Phone: (818) 264-1325 Email: info@dfinsurance.com