Tax Advantaged Plan Documents

Plan Documents

Many small companies simply do not take advantage of tax advantaged programs to help reduce their benefit costs. Programs such as Flexible Spending Accounts (FSA), Health Reimbursement Arrangements (HRA) Dependent Care Accounts (DDC) and Transit Accounts are often inexpensive to set up and maintain.

The IRS Code has numerous provisions designed to help employers provide essential benefits to their employees tax-free. This saves the employee approximately 30% in income taxes on expenses they’re already paying for, and because the employees have reduced their taxable income, the employer realizes a reduced matching payroll tax liability of approximately 8%. Everybody saves money. To take advantage of these tax deductions the IRS requires that the employer have a written plan document and the Department of Labor and ERISA law require that every employee receive a summary plan description (SPD) explaining the new benefit in easy to understand language.