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Flexible Spending Accounts
The Internal
Revenue Code, Section 125, provides employees
with a choice in the form of their compensation:
the choice between cash, which is taxable, and
benefits, many of which are non-taxable. The
advantages of implementing a flexible benefit
plan include savings on income taxes,
controlling benefit costs, and meeting
competitive pressures.
Levels of
Flexible Benefit Plans
There are three levels
of flexible benefit plans that an employer may
choose:
- Premium Conversion Plans.
These plans allow employees to pay their
share of the benefit plan premium, or
employee contribution, on a tax-free basis
through salary reduction.
- Flexible Spending Accounts. These
permit employees to pay for eligible
out-of-pocket health care and dependent care
expenses with pre-tax dollars.
- Full Cafeteria Plans. These types
of plans provide employees with employer
credits and a menu of benefits. Employees
determine whether to spend the employer
credits on benefits, receive some portion in
cash, or allocate some or all of the credits
for retirement in a 401 (k) program.
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The Benny™' MasterCard® is
a special card that draws on the value of
your annual Unreimbursed Medical Spending
Account election amount or Unreimbursed
Dependant Care Expense election amount. Using Benny™' is
simple, because funds are immediately
transferred from your Unreimbursed Medical
Spending Account at the time you incur a
qualifying expense, improving your cash flow
because you don't have to lay out cash at
the time of purchase. You can use the
Benny™' Card for qualifying expenses, such
as covered Rx copayments, health plan
copayments and deductibles, orthodontics,
eyeglasses, LASIK surgery, and more.
The Benny™' Card is sent to you
automatically upon enrollment in the
Unreimbursed Medical Spending Account plan.
There is no additional application to fill
out! The Benny MasterCard is good for
five years and should not be thrown away at
the end of the plan year.
REMINDER: When using your Benny card,
be sure to save your receipts. In order to
comply with IRS regulations, we are required
to audit card transactions. If you receive
an audit letter from us, please be sure to
send a copy of your receipt and not your
original. The original should be kept for
your records.
Services We
Provide
As the administrator of your Flexible Benefit
Plan, we can provide the following services to
you and your employees:
- Plan design and consultation
- Plan and claims administration
- Employee meetings, brochures, and plan
documents
- Quarterly Flexible Spending Account
Statements to employees
- ERISA Compliance and 5500 filing
If you are interested in learning more about
Flexible Benefit Plans, please contact our
Marketing Department at (330) 867-8443, or
submit your inquiry through our "Request
Information" option on this site.
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