Section 125 Cafeteria Plan

Section 125 Premium Only Plans, sometimes referred to as POP Plans, reduce income tax liabilities for both the employer and employee. This is because IRS Section 125 allows employees to make special salary deduction elections to pay their portion of medical insurance premiums using pretax or tax-free dollars.

Employees save 22.65% to 40% of their pre-tax Section 125 premium deductions in just federal income taxes alone. The actual tax savings are on city, state, and federal income taxes, including Social Security and Medicare taxes on all money employees use to pay for their portion of insurance premiums. Under a Section 125 POP employees take-home pay is increased which helps reduce the high cost of providing health coverage for family members

Flex Spending Account (FSA) Administration

Health Flexible Spending Accounts, previously known as Medical Expense Reimbursement Plans or Medical FSA plans allow employees to use pre-tax dollars to pay out of pocket medical expenses not covered by health insurance. The Health FSA reduces payroll taxes for both the employer and the employee making it a popular benefit option. For the employee it's like getting a 30% discount on medical, dental and vision care expenses

Dependent Care Flex Spending Account (FSA) Administration

The Section 129 Dependent Care Assistance Plan is a special Flexible Spending Account that enables an employee to make special pretax elections from their paycheck to pay for child and adult daycare expenses. The expenses must be necessary to enable one or both parents or guardian to work, look for employment, or go to school.

Section 132                               Commuter Benefit Plan

Internal Revenue Code Section 132 and the Transportation Equity Act for the 21st Century (TEA-21) allows employers to offer employees the opportunity to set aside a portion of their salary to pay for certain transportation expenses. The employee will not be taxed on amounts set aside and used for qualified expenses (that is, pre-tax dollars are used to pay the commuting expenses).

Under IRS Section 132 and TEA-21 qualified transportation expenses generally include payments for the use of mass transportation (for example, train, subway, bus fares), and for parking (see further details below). For 2008 the maximum monthly pre-tax contribution for mass transit is $115.00, and $220.00 for parking. These limits are indexed for inflation

What are the cost for these services?

• All services listed are included with an AFS Paychecks leased employee arrangements.