Call Us Today! (866) 639-1662
Alderette Insurance Agency, Inc.
Call Us Today! (866) 639-1662
Section 125 Cafeteria Plans (also called a Premium Only Plan or “POP”) and how it can save you and your employees’ money
A Section 125 Cafeteria Plan is neither a health plan nor is it a place to eat lunch! A Section 125 plan (also referred to as a Premium Only Plan or “POP”) is a simple, IRS-approved change in your payroll process that allows you to use pre-tax salary dollars to pay your employees’ share of benefit premiums. Any size employer can take advantage of this special provision of Section 125 of the IRS code. Under a POP, employees will save an average of 30% - 40% on insurance premiums they deduct from their pay. That’s because a POP allows premiums to be deducted on a pre-tax basis. You, the employer, will also save about 7.65% (the FICA match) on every dollar your employees deduct. As a result, both employers and employees profit. Employees reduce their taxable income, which lowers their taxes and increases their take-home pay. You cut your payroll taxes by decreasing your total taxable payroll. Everybody wins – and saves.
Setting up a Section 125 POP is a simple and straightforward process that we can walk you through. It begins by completing a simple one page application. Most POP administrators charge an annual fee of $120. The POP administrator is usually the same as the insurance company you have your group health insurance through, but it doesn’t have to be. Call us at 866-639-1662 or contact us here to find out how to get a free POP!
In addition to group health insurance, other benefits that can fall under a POP are: Dental & Vision plans, Critical Illness, Cancer, Hospital Indemnity, Group-Term Life Insurance (up to $50,000) and Health Savings Account contributions.
High Deductible Health Plan (HDHP) + Health Savings Account (HSA) or Health Reimbursement Arrangement (HRA)
This is one way for a small business to offer health insurance to employees at a reduced cost. HDHP’s (as the name suggests) do have very high deductibles, but the trade off is that they have much lower premiums compared to typical health plans. Like all health plans that comply with ACA requirements, HDHP’s cover preventive care without having to meet the deductible. They also have Out of Pocket Maximums which limits the exposure of catastrophic health care costs (the Out of Pocket Maximum is the most an enrollee could be responsible for within a calendar year). Pairing a HDHP with a tax advantaged Health Savings Account or Health Reimbursement Arrangement is a way to help pay for the deductible and Out of Pocket Maximum. Like all options, this approach has pros and cons that have to be carefully considered before deciding on offering this type of benefit.
Small Business Tax Credit
The small business health care tax credit is a part the Affordable Care Act and is for employers who have less than 25 employees. The credit works on a sliding-scale that is based on the number of full time employees within a company. The more employees a company has, the smaller the tax credit and vise versa. The most a company may qualify for is a credit of up to 50% off of premiums. However, non-profit employers are only eligible for up to 35% off of premiums. The tax credit is highest for companies with fewer than 10 employees who are paid an average of $27,000 or less.
Eligible companies can take advantage of the Small Business Health Care Tax Credit for two consecutive tax years. If an eligible company does not owe any tax for one year, the credit can be applied backwards or forwards to other tax years. Any excess amount paid by an employer for health insurance premiums above the allowable credit can be deducted as a business expense.
To qualify for the tax credit, all of the following must apply:
To speak with a group insurance specialist, call us now at (866) 639-1662 or click here to get a free quote.
Section 125 Cafeteria Plans (also called a Premium Only Plan or “POP”) and how it can save you and your employees’ money
A Section 125 Cafeteria Plan is neither a health plan nor is it a place to eat lunch! A Section 125 plan (also referred to as a Premium Only Plan or “POP”) is a simple, IRS-approved change in your payroll process that allows you to use pre-tax salary dollars to pay your employees’ share of benefit premiums. Any size employer can take advantage of this special provision of Section 125 of the IRS code. Under a POP, employees will save an average of 30% - 40% on insurance premiums they deduct from their pay. That’s because a POP allows premiums to be deducted on a pre-tax basis. You, the employer, will also save about 7.65% (the FICA match) on every dollar your employees deduct. As a result, both employers and employees profit. Employees reduce their taxable income, which lowers their taxes and increases their take-home pay. You cut your payroll taxes by decreasing your total taxable payroll. Everybody wins – and saves.
Setting up a Section 125 POP is a simple and straightforward process that we can walk you through. It begins by completing a simple one page application. Most POP administrators charge an annual fee of $120. The POP administrator is usually the same as the insurance company you have your group health insurance through, but it doesn’t have to be. Call us at (866) 639-1662 or contact us here to find out how to get a free POP!
In addition to group health insurance, other benefits that can fall under a POP are: Dental & Vision plans, Critical Illness, Cancer, Hospital Indemnity, Group-Term Life Insurance (up to $50,000) and Health Savings Account contributions.
High Deductible Health Plan (HDHP) + Health Savings Account (HSA) or Health Reimbursement Arrangement (HRA)
This is one way for a small business to offer health insurance to employees at a reduced cost. HDHP’s (as the name suggests) do have very high deductibles, but the trade off is that they have much lower premiums compared to typical health plans. Like all health plans that comply with ACA requirements, HDHP’s cover preventive care without having to meet the deductible. They also have Out of Pocket Maximums which limits the exposure of catastrophic health care costs (the Out of Pocket Maximum is the most an enrollee could be responsible for within a calendar year). Pairing a HDHP with a tax advantaged Health Savings Account or Health Reimbursement Arrangement is a way to help pay for the deductible and Out of Pocket Maximum. Like all options, this approach has pros and cons that have to be carefully considered before deciding on offering this type of benefit.
Small Business Tax Credit
The small business health care tax credit is a part the Affordable Care Act and is for employers who have less than 25 employees. The credit works on a sliding-scale that is based on the number of full time employees within a company. The more employees a company has, the smaller the tax credit and vise versa. The most a company may qualify for is a credit of up to 50% off of premiums. However, non-profit employers are only eligible for up to 35% off of premiums. The tax credit is highest for companies with fewer than 10 employees who are paid an average of $27,000 or less.
Eligible companies can take advantage of the Small Business Health Care Tax Credit for two consecutive tax years. If an eligible company does not owe any tax for one year, the credit can be applied backwards or forwards to other tax years. Any excess amount paid by an employer for health insurance premiums above the allowable credit can be deducted as a business expense.
To qualify for the tax credit, all of the following must apply:
To speak with a group insurance specialist, call us now at (866) 639-1662 or tap here to get a free quote.
Section 125 Cafeteria Plans (also called a Premium Only Plan or “POP”) and how it can save you and your employees’ money
A Section 125 Cafeteria Plan is neither a health plan nor is it a place to eat lunch! A Section 125 plan (also referred to as a Premium Only Plan or “POP”) is a simple, IRS-approved change in your payroll process that allows you to use pre-tax salary dollars to pay your employees’ share of benefit premiums. Any size employer can take advantage of this special provision of Section 125 of the IRS code. Under a POP, employees will save an average of 30% - 40% on insurance premiums they deduct from their pay. That’s because a POP allows premiums to be deducted on a pre-tax basis. You, the employer, will also save about 7.65% (the FICA match) on every dollar your employees deduct. As a result, both employers and employees profit. Employees reduce their taxable income, which lowers their taxes and increases their take-home pay. You cut your payroll taxes by decreasing your total taxable payroll. Everybody wins – and saves.
Setting up a Section 125 POP is a simple and straightforward process that we can walk you through. It begins by completing a simple one page application. Most POP administrators charge an annual fee of $120. The POP administrator is usually the same as the insurance company you have your group health insurance through, but it doesn’t have to be. Call us at (866) 639-1662 or contact us here to find out how to get a free POP!
In addition to group health insurance, other benefits that can fall under a POP are: Dental & Vision plans, Critical Illness, Cancer, Hospital Indemnity, Group-Term Life Insurance (up to $50,000) and Health Savings Account contributions.
High Deductible Health Plan (HDHP) + Health Savings Account (HSA) or Health Reimbursement Arrangement (HRA)
This is one way for a small business to offer health insurance to employees at a reduced cost. HDHP’s (as the name suggests) do have very high deductibles, but the trade off is that they have much lower premiums compared to typical health plans. Like all health plans that comply with ACA requirements, HDHP’s cover preventive care without having to meet the deductible. They also have Out of Pocket Maximums which limits the exposure of catastrophic health care costs (the Out of Pocket Maximum is the most an enrollee could be responsible for within a calendar year). Pairing a HDHP with a tax advantaged Health Savings Account or Health Reimbursement Arrangement is a way to help pay for the deductible and Out of Pocket Maximum. Like all options, this approach has pros and cons that have to be carefully considered before deciding on offering this type of benefit.
Small Business Tax Credit
The small business health care tax credit is a part the Affordable Care Act and is for employers who have less than 25 employees. The credit works on a sliding-scale that is based on the number of full time employees within a company. The more employees a company has, the smaller the tax credit and vise versa. The most a company may qualify for is a credit of up to 50% off of premiums. However, non-profit employers are only eligible for up to 35% off of premiums. The tax credit is highest for companies with fewer than 10 employees who are paid an average of $27,000 or less.
Eligible companies can take advantage of the Small Business Health Care Tax Credit for two consecutive tax years. If an eligible company does not owe any tax for one year, the credit can be applied backwards or forwards to other tax years. Any excess amount paid by an employer for health insurance premiums above the allowable credit can be deducted as a business expense.
To qualify for the tax credit, all of the following must apply:
To speak with a group insurance specialist, call us now at (866) 639-1662 or tap here to get a free quote.
By using this site, you acknowledge that you have read and agree to the Terms of Service and Privacy Policy. Please read our privacy policy carefully to get a clear understanding of how we collect, use, protect or otherwise handle your Personally Identifiable Information in accordance with our website. Alderetteinsurance.com is privately owned and operated by Alderette Insurance Agency, Inc. Submission of your information constitutes permission for an agent to contact you with additional information about the cost and coverage details of health plans. Possible options include, but are not limited to Major Medical Plans, Short Term Plans, Dental Plans, Vision Plans, and more. Descriptions are for informational purposes only and subject to change. Insurance plans may not be available in all states. For a complete description, please call 1-866-639-1662 to determine eligibility and to request a copy of the applicable policy. Alderetteinsurance.com is not affiliated with or endorsed by the United States government or the federal Medicare program. We do not offer every Medicare plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE (TTY users should call 1-877-486-2048) 24 hours a day/7 days a week to get information on all of your options. Our company complies with applicable state laws and federal civil rights laws and does not discriminate, exclude people, or treat them differently on the basis of race, color, national origin, ethnic group identification, medical condition, genetic information, ancestry, religion, sex, marital status, gender, gender identity, sexual orientation, age, mental disability, or physical disability.
By using this site, you acknowledge that you have read and agree to the Terms of Service and Privacy Policy. Please read our privacy policy carefully to get a clear understanding of how we collect, use, protect or otherwise handle your Personally Identifiable Information in accordance with our website. Alderetteinsurance.com is privately owned and operated by Alderette Insurance Agency, Inc. Submission of your information constitutes permission for an agent to contact you with additional information about the cost and coverage details of health plans. Possible options include, but are not limited to Major Medical Plans, Short Term Plans, Dental Plans, Vision Plans, and more. Descriptions are for informational purposes only and subject to change. Insurance plans may not be available in all states. For a complete description, please call 1-866-639-1662 to determine eligibility and to request a copy of the applicable policy. Alderetteinsurance.com is not affiliated with or endorsed by the United States government or the federal Medicare program. We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE (TTY users should call 1-877-486-2048) 24 hours a day/7 days a week to get information on all of your options. Our company complies with applicable state laws and federal civil rights laws and does not discriminate, exclude people, or treat them differently on the basis of race, color, national origin, ethnic group identification, medical condition, genetic information, ancestry, religion, sex, marital status, gender, gender identity, sexual orientation, age, mental disability, or physical disability.
By using this site, you acknowledge that you have read and agree to the Terms of Service and Privacy Policy. Please read our privacy policy carefully to get a clear understanding of how we collect, use, protect or otherwise handle your Personally Identifiable Information in accordance with our website. Alderetteinsurance.com is privately owned and operated by Alderette Insurance Agency, Inc. Submission of your information constitutes permission for an agent to contact you with additional information about the cost and coverage details of health plans. Possible options include, but are not limited to Major Medical Plans, Short Term Plans, Dental Plans, Vision Plans, and more. Descriptions are for informational purposes only and subject to change. Insurance plans may not be available in all states. For a complete description, please call 1-866-639-1662 to determine eligibility and to request a copy of the applicable policy. Alderetteinsurance.com is not affiliated with or endorsed by the United States government or the federal Medicare program. We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE (TTY users should call 1-877-486-2048) 24 hours a day/7 days a week to get information on all of your options. Our company complies with applicable state laws and federal civil rights laws and does not discriminate, exclude people, or treat them differently on the basis of race, color, national origin, ethnic group identification, medical condition, genetic information, ancestry, religion, sex, marital status, gender, gender identity, sexual orientation, age, mental disability, or physical disability.