cafeteria plan

(redirected from Section 125 Plans)
Also found in: Medical, Financial.

cafeter′ia plan`

a fringe-benefit plan under which employees may choose from among various benefits those that best fit their needs up to a specified dollar value.
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References in periodicals archive ?
4 Contributions to HSAs under Section 125 plans are subject to nondiscrimination rules.
The NAHU LTC finance proposal calls for the government to let taxpayers use the money inside Section 125 plans, 401(k) plans, 403(b) plans and individual retirement accounts (IRAs) to pay for LTCI.
Think about Section 125 plans. Someone figured out that this tax benefit had created an opportunity to sell more voluntary products.
Its payroll services include payroll processing, payroll tax administration and employee pay services; and its human resource services include 401(k) plan record keeping, section 125 plans, a professional employer organisation, time and attendance solutions and other administrative services for business.
Paychex's human resource services include 401(k) plan recordkeeping, section 125 plans, a professional employer organization, time and attendance solutions, and other administrative services.
Section 125 plans also allow employees to make before-tax contributions to personal spending accounts that can be used for qualifying health-care or child-care expenses.
In three states, Mark Hall studied the use of section 125 plans to allow tax-free premiums for individuals to purchase insurance who work for small employers.
Section 125 plans also may be used to pay health insurance premiums.
Those in the insurance industry have a dim view of the bill's stipulation that, beginning in January, over-the-counter drugs not prescribed by a doctor won't be covered by cafeteria plans, also called Section 125 plans or flexible spending accounts.
Cafeteria plans, also described as "flexible benefit" plans or Section 125 plans, allow participating employees to choose between a number of non-taxable qualified benefits or taxable cash.
Section 125 plans, commonly known as "cafeteria plans" or flexible benefit plans, make it possible for employers to offer their employees a choice between cash and a variety of nontaxable benefits.