Tim Wiedman Associates
--Where Serving you is our Number One Priority--
Tips and Tools
A section 125 Premium Only Plan, can save your business money on taxes...
Sometimes a section 125 Premium Only Plan and a cafeteria plan are confused. They are not the same. A Premium Only Plan is easy to set up and will allow your employees to pay their portion of insurance premiums with pre tax dollars. That means they save money because they do not pay taxes on the money spent in this way. It also saves the business money, because no FICO tax is paid on these moneys by the employer. Depending upon the sums involved, you may very well save more money in your first year than the set up costs involved. There are various ways to set these plans up. For example, there are insurance companies that will provide you with a plan for free, as long as you use their insurance services. We recomend setting up your own plan independently, that way it 'floats' with you from one year to another, even if you change insurance carriers. The fees are minimal; we can provide you with forms for less than $100.00. If you would like to discuss this further with us, please Contact Us
Sometimes a section 125 Premium Only Plan and a cafeteria plan are confused. They are not the same. A Premium Only Plan is easy to set up and will allow your employees to pay their portion of insurance premiums with pre tax dollars. That means they save money because they do not pay taxes on the money spent in this way. It also saves the business money, because no FICO tax is paid on these moneys by the employer. Depending upon the sums involved, you may very well save more money in your first year than the set up costs involved. There are various ways to set these plans up. For example, there are insurance companies that will provide you with a plan for free, as long as you use their insurance services. We recomend setting up your own plan independently, that way it 'floats' with you from one year to another, even if you change insurance carriers. The fees are minimal; we can provide you with forms for less than $100.00. If you would like to discuss this further with us, please Contact Us
