Frequency of Updates:Annually
PPC's Guide to Cafeteria Plans provides easy-to-understand coverage of the unique requirements for establishing and operating a cafeteria plan. Cafeteria plans are becoming an increasingly popular way of providing employee benefits at a reduced cost to the business and its employees. Employers benefit by maximizing tax deductions as well as reducing payroll costs. Employees are able to increase their take-home pay by paying for benefit coverage on a pretax basis. However, to qualify for special tax treatment, a cafeteria plan must meet very specific requirements.
Topics discussed include:
- Permitted and prohibited benefits.
- Rules for eligibility and participation.
- Contribution requirements for both the employee and the employer.
- Taxability of contributions and benefit payments.
- Nondiscrimination testing.
- Reporting and disclosure requirements.
- Flexible spending accounts, including the allowable grace period for using balances in an account.
- Simple cafeteria plans, which are plans that have less complicated contribution, eligibility, and participation requirements that can be established by eligible small employers.
The Guide also contains sample plan documents and checklists that can be used to quickly and efficiently monitor a plan’s compliance with the various cafeteria plan requirements and marketing tools, letters, and step-by-step guidance that can help practitioners sell cafeteria plan implementation and operation engagements.
- PPC's Guide to Cafeteria Plans: List of Substantive Changes View