Flexible Spending Accounts (FSA/POP) Section 125

Premium Offset Plan (POP)

  1. What is a POP?

    2. A Premium Offset Plan is a provision under the Internal Revenue Code Section 125 that enables employers to allow their employees to have certain premiums that they have to pay out of their paycheck, to be taken out before the employee pays tax.  These premiums would be taken out before the Federal tax, FICA tax, and the State tax.  The POP also allows the employers to save on the matching FICA that they would have had to contribute on this amount.

  2. What Premiums Qualify?
  • Health
  • Prescription
  • Dental
  • Vision
  • Disability
  • Employee Group Term Life (up to $50,000)
  • Cancer
  • Medicare Supplement
  • Hospital Indemnity
  • Accident

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    Flexible Spending Accounts (FSA)

    1. What is an FSA?

      2. An FSA is an account that an employee sets up, through their employer, with HR Concepts (similar to a savings account).  It enables them to deduct money out of their payroll on a pretax basis and directly deposit these funds into an account with HR Concepts. These funds can later be withdrawn from this account on a tax free basis to pay for eligible medical, dental, vision, over the counter, prescription, and dependent care expenses for themselves, their spouse, and eligible dependent children. They are a great way to save taxes and reduce your out of pocket expenses!

    2. How Do FSA’s Work?

      3. Before the effective date of your FSA plan year (Decided by the employer), an employee will calculate how much money they think they and their dependents will spend during the plan year on your out of pocket expenses for medical, dental, vision, over the counter, prescription, and dependent care expenses. This annual number is divided by the amount of payrolls during the plan year and this amount will be deducted from the employee's payroll each period and deposited into their FSA. This money comes out before they pay Federal Tax, FICA Tax, and State Tax. After you add up their tax savings with their money in this account, they effectively have increased their take home pay. 
      They will have the opportunity to change their election each plan year and also if they have a qualifying event; which includes marriage, divorce, death, or birth in their immediate family.  If they have a qualifying event, they can increase or decrease your annual election within a 30-day period following the event. 

       

     

    Outline of Services

     

    Initial Setup / Installation / Take-Over

    1. Initial Consultation

      2.  HR Concepts works with you to create the right Cafeteria Plan to fit your company’s budget and benefit needs.  We integrate with your existing benefit programs and implement our procedures, which you customize, to keep your employees satisfied.

    2. Suggested Legal Documents

      3. Whether it is a new plan or take-over, HR Concepts will provide you with suggested plan documents, summary plan description, and corporate resolution.

    3. Interface With Existing Broker / Benefit Consultant

      4. After we analyze your current Health Insurance design, we interface with your existing broker and/or benefit consultant to create a coordinated employee benefits package. 

     

    Employee Communications

    1. Enrollment Forms / Materials

      2. HR Concepts will provide you with enrollment kits that each employee received during the enrollment process.   

    2. Enrollment Meetings

      3. Upon the initial setup or takeover, HR Concepts will provide enrollment meetings and education sessions to introduce the FSA to the employees.  After this initial time, HR Concepts will conduct enrollment meetings for employees annually and when there is a significant amount of new hires.

    3. Claim Forms

      4. If employees decide to not use the FSA Debit card, or for expenses not covered by the card, HR Concepts will provide claims forms that can be submitted for reimbursement from the accounts.

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    On-Going Administration Services

    1. Daily Claims Administration

      2. HR Concepts provides employers with a FSA Debit card for each employee.  These cards are considered Visa cards; however, they can only be used at predefined locations.  If an expense cannot be put through on the card, then the employee can submit this claim by mailing, faxing, online, or dropping it off to HR Concepts.  Upon receipt, the claim will be processed and a check will be dispensed.

    2. Online Employee Account Balances

      3. Employees will have access to checking their balances of their FSA accounts online.  They will also be allowed to download claim forms and enrollment material.

    3. Online Employer Account Statuses

      4. Employers will have access to periodic plan activity and employee's account balances via the web or by calling HR Concepts.

    4. Discrimination Testing

      5. Upon a client's request HR Concepts will perform the annual discrimination testing as part of your compliance review

    5. 5500 Filing

      6. HR Concepts does not provide 5500 filing services, however we will provide you with any information your tax advisor requires within 30 days of your request to HRC.

     

    Visit FSAStore to view FSA eligible products and FSA eligible with prescription products