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Flexible Benefits/ Cafeteria Plans
National Summary
What are flexible benefits? Flexible benefit, or cafeteria plans generally allow employees to choose between cash compensation, tax-exempt benefits, and taxable benefits without the choice itself resulting in the inclusion of the tax-exempt benefits in taxable income. Flex or cafeteria plans are authorized by Internal Revenue Code (IRC Sec. 125) and are often referred to as Section 125 plans. Under such a plan, it is possible for employers to provide employees with an additional benefit package at virtually no extra cost while reducing both the employer's and the employees' tax bills. Flex plans allow employers to upgrade and customize the array of benefits offered while keeping a handle on total benefit costs. Flex plans range from the most simple (that merely pay group insurance premiums with pretax dollars) to the most complex (that provide benefit credits and a choice of types and levels of benefits that may be chosen and paid for on either a pretax or post-tax basis).
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TypeTitleDateState
2652state_comparison_charts.aspxGuidance Advantages and Disadvantages of Flexible Benefits  National
84529faqs.aspxQuestions & Answers Can an early retiree continue to participate in an FSA if they are still receiving a paycheck from the company they retired from? Thanks! 01/06/2011National
81105faqs.aspxQuestions & Answers Can an employee terminate his medical coverage through a Section 125 plan mid-year without a qualfiying event? 10/29/2009National
91660faqs.aspxQuestions & Answers Can an employer allow the EE (spouse and dependents) to come onto the dental plan midterm as well as run through their Section 125? 05/25/2012National
92425faqs.aspxQuestions & Answers Can an employer make a matching contribution to an HSA if the employee contributes? 10/11/2012National
81257faqs.aspxQuestions & Answers Can employees use FSA funds for their parents' expenses, if the parents are claimed as dependents on their tax returns? 11/19/2009National
88368faqs.aspxQuestions & Answers Can employees use HSA funds to pay for an adult child's medical expenses if the child is not on the employee's plan? 06/20/2011National
80676faqs.aspxQuestions & Answers Can we withhold from a last paycheck to make up for a FSA deficit? 09/06/2009National
80327faqs.aspxQuestions & Answers Do we need to ask employees to sign a waiver before submitting copies of documentation to collect from their Sec 125, HRA's etc.? 07/24/2009National
82870faqs.aspxQuestions & Answers Doe you have information on the "tests" employers can use to see if they are meeting nondiscrimination rules for health care coverage? 07/16/2010National
18334timesavers.aspxChecklists Flexible Benefits Checklist  National
81057faqs.aspxQuestions & Answers I've been told that when an employee has voluntary life insurance that the premium must be deducted on an after tax basis. Is that true for voluntary AD&D, AFLAC and similar insurance that our voluntary options to the employee. We do have a Sectio 10/21/2009National
81097faqs.aspxQuestions & Answers If we discontinue health insurance for our employees and they attain it on their own, can they submit the monthly premiums for reimbursement from the flexible spending account? 10/28/2009National
86937faqs.aspxQuestions & Answers Is it legal to take premiums out pre-tax for things like a child's COBRA coverage or for the purchase of insurance outside of the company? 04/13/2011National
80517faqs.aspxQuestions & Answers Is it true that owners, partners, and their families in an S-Corp, Sole Proprietor, Partnership, LLC or LLP, are not eligible to participate in an HRA or HSA? 08/14/2009National
88295faqs.aspxQuestions & Answers Is my employer required by law to distribute SPDs for its Flexible Spending Account benefit plan? 06/16/2011National
81365faqs.aspxQuestions & Answers My company offers Flexible Spending Account (FSA) to employees. Over the years, our FSA has accumulated a surplus. The surplus amount includes money forfeited from former employees. Can we give the unused amount to employees? 12/15/2009National
82155faqs.aspxQuestions & Answers Our company is changing from an FSA to a high deductible with an HSA. Can employees roll over funds from the FSA to the HSA? 04/26/2010National
82053faqs.aspxQuestions & Answers Our HDHP was set up on the 1st of the month, but the HSA set up was delayed (by the carrier) until the 10th of the month. Now the carrier says the HSA can't pay a claim that came in on the 6th. What can we do? 04/13/2010National
90316faqs.aspxQuestions & Answers Outside enrollment period, can an employee add a spouse to his insurance plan when the spouse's insurance costs at her employer have gone up significantly? 10/28/2011National
81520faqs.aspxQuestions & Answers Regarding HSA plans for >2% shareholders. If an individual is both a shareholder and an employee, can the company make a contribution to the individual's HSA plan? If so, is the contribution included in their gross income? Is it deductible? 01/12/2010National
81830faqs.aspxQuestions & Answers We changed our renewal date from 1/1 to 3/1 and changed to a HDHP with an HSA account. Our FSA that has been set up since 1/1 will change to a limited medical benefit account. Can FSA elections be changed? 03/02/2010National
90004faqs.aspxQuestions & Answers We deducted from employees' paychecks for an FSA plan, but forgot to tell our FSA administrator the employees signed up. How do we return the money to the employees? 09/27/2011National
81437faqs.aspxQuestions & Answers We have an HDHP plan that we are funding with an HRA. There are 5 dependents interested in the Young Adult Option for dependent to age 29. Do we have to fund the HRA for the dependents? 12/22/2009National
81517faqs.aspxQuestions & Answers We have an HSA based medical plan. We contribute a small amount and the employees are allowed to contribute pre-tax contributions. Are any IRS filings required? 01/11/2010National
86265faqs.aspxQuestions & Answers We have distributed to employees plan documents, SPDs, and benefits booklets. However, we have not included the cafeteria plan document. Is this correct? 03/16/2011National
80536faqs.aspxQuestions & Answers What are the tax and legal implications of a Vacation Buy Program? 08/17/2009National
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