FSA & Section 125: Trion's Options
Cafeteria Section 125 Plans
A Cafeteria Plan 125 is a plan maintained by an employer for employees that meets the specific requirements and regulations of Section 125 of the Internal Revenue Code. Often referred to as a Cafeteria plan, It provides participants an opportunity to receive certain benefits on a pretax basis.
A Flexible Spending Account (FSA) is a form of Section 125 plan benefit, funded by salary reduction, that reimburses employees for expenses incurred for certain qualified benefits. An FSA may be offered for health care reimbursement (Health FSA and Medical FSA) dependent care reimbursement (Dependent Care FSA). The benefits are subject to an annual maximum and are subject to an annual "use-or-lose" rule.
Internal Revenue Code Section 132 and the Transportation Equity Act for the 21st Century allows employers to offer employees the opportunity to set aside a portion of their salary to pay for certain transportation expenses into Qualified Transportation Reimbursement Accounts. The employee will not be taxed on amounts set aside and used for qualified expenses (that is, pre-tax dollars are used to pay the commuting expenses).
The Internal Revenue Service provided for Health Reimbursement Accounts (HRAs) in Notice 2002-45 and Revenue Ruling 2002-41. These are employer funded accounts which allow employees to be reimbursed for eligible medical expenses.
All spending accounts are administered on Trion’s integrated platform and accessible through Trion’s FSA Debit Cards.
» To speak with a Trion Professional for Plan design ideas, which can save your company benefit dollars, please request a proposal.