Section 125 & FSA

A Flexible Benefit Plan acts as an umbrella that allows employers to offer certain benefits on a pre-tax basis such as a Section 125 Cafeteria Plan and a Section 132 Transportation Plan.

Healthcare Flexible Spending Account (FSA)

A Healthcare FSA is a non-interest bearing account funded through payroll deductions on a pre-tax basis which can be used by the employee for medical, dental, and vision expenses such as prescriptions, doctor’s office copays,orthodontia, and eyeglasses. The IRS has set a maximum annual limit of $2,550 for a Healthcare FSA, butthe employer may set a lower limit. Employees are required to make their elections during open enrollment.

Funds are withheld through payroll on a pre-tax basis in equal amounts throughout the Plan Year. Claims aresubmitted to TDS and reimbursements are issued directly to the employees. Employees are allowed to use the total planned annual contributions at any time throughout the plan year. This may result in the employee

who terminates employment mid plan year to receive more benefits than their total contributions for the year.

Section 125 Differentiators

  • Rollovers
  • Online Self-Enrollment
  • Agent Assistance
  • Video Supported Education
  • Health FSA Debit Card
  • Dependent Care FSA Debit Card
  • Free Administration
  • Electronic Data Update to Payroll
  • Day to Process Claims (1 business day)
  • Dependent Care Claims (Easy 1-claim method)

*When a Dependent Care deduction is withheld from a paycheck, we can issue a reimbursement to the employee within one business day.