Section 125/cafeteria plans
The Section 125 "cafeteria" plan design allows employees to pick and choose desired benefits from their employer's benefit package. Employers can choose to offer a variety of policies, including those listed below.
The real benefit of this plan design is that, if set up in accordance with Section 125 rules outlined by the Internal Revenue Service (IRS), employees can pay their premiums with tax-free money.
Available policies
The following policies are available for inclusion in the Section 125/cafeteria plan we offer through USAble Life:
- Health
- Dental
- Group term life - up to $50,000 on employees only
- Accidental death & dismemberment
- Accident
- Cancer
- Hospital indemnity
- Critical illness
Flexible spending accounts
Flexible spending accounts (FSA) are also available as an option with Section 125/cafeteria plans. The FSA is one of the most versatile benefits of this plan design.
With an FSA, employees can direct a portion of their pre-tax salary into a tax-free account and then use the funds to pay eligible medical and dependent care expenses.
