TDKM assists clients with payroll tax saving opportunities by sponsoring Section 125 Cafeteria Plans administered by Total Administrative Services Corporation (TASC). 

A Section 125 Cafeteria Plan provides the option for employees to select certain benefits normally paid on an after-tax basis and, through salary reduction, pay for these benefits on a pre-tax basis.  Common benefits include:

bulletPremium Conversion Plans for medical or health related insurance benefits enabling employees to pay their share of health insurance premiums with pre-tax dollars.
bulletMedical Flexible Spending Accounts allow employees to pay for eligible medical expenses, such as insurance deductibles, co-payments, dental and vision expenses on a pre-tax basis.
bulletDependent Care Flexible Spending Accounts enable employees to pay for dependent care expenses on a pre-tax basis.

By offering Section 125 Plans, employers are able to realize a number of benefits including:

bulletReduced Payroll Costs with reduced social security contributions for each dollar of employee participation.
bulletCost Control of company's share of medical costs, without limiting employee choices.
bulletIndividually Tailored Benefits at little or no cost to company.
bulletRecruit and Retain Quality Employees with a benefit package with the employees interest in mind.

Flex Savings Plan Scenario

Includes Medical Expenses, Insurance Premiums and Day Care Expense.

w/o FLEX

w/ FLEX

Gross Salary

$ 1,475

$ 1,475

Medical Premiums

-

(110)

Medical Expenses

-

(60)

Day Care Expense

-

(300)

Reported Gross Salary

$ 1,475

$ 1,005

Federal and State Tax Withholding

(200)

(97)

Social Security Withholding

(112)

(76)

Net Check

$ 1,163

$ 832

Medical Premiums

(110)

-

Medical Expenses

(60)

-

Day Care Expense

(300)

-

Net AVAILABLE Spending

$ 693

$ 832

Increase in check

$ 139

Contact Ellen at TDK for more information on what Section 125 Cafeteria Plans can do for you.

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Turbes Drealan Kvilhaug Mammen & Co., P.A.
 tdkcpa@tdkcpa.net
909 Fourth Avenue, Worthington, MN 56187  507-376-4151  Fax: 507-376-4154
114 W. Main Street, Luverne, MN 56156  507-283-2116  Fax: 507-283-2117