What is a Section 125 Plan and Who Needs One?
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Section 125 – Cafeteria Plans
A section 125 plan, often referred to as a cafeteria plan or POP plan, provides a means for employers to create a tax savings arrangement for their employees to pay for certain benefits on a pre-tax basis. This arrangement increases the employee’s take home pay, reduces the employee’s taxable income, and therefore, also reduces the employer’s tax liability. Section 125 plans must comply with certain rules and regulations under the Internal Revenue Code.
Contact your OneDigital consultant to determine the type of Section 125 Plan that works best for your organization.
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