Administering a Cafeteria Plan
February 8, 2012
Administering a Cafeteria Plan
Whether you decide to administer the plan yourself or contract with a third party administrator will make a significant difference in your ongoing involvement with your cafeteria plan. If you are going to self-administer the plan, you will need to consider issues such as employee counseling, payroll withholding, providing updated financial statements, and plan distributions, among others. These burdens can be reduced by having your more significant cafeteria plans administered from the outside.
Review Your Cafeteria Plan and Seek Employee Input
Because of constantly evolving trends in the economy, labor market and tax rules, it's important to frequently revisit your plan's various features, for both you and your workforce. Annually adjusted contribution limits, changed features of qualified plans, and growing employee interest in participation all could affect what you decide to offer. Remember, since one of the advantages of offering a cafeteria plan is to get a recruiting edge, a program that reflects employee priorities will serve your business better.
Sample Section 125 Plan Documents
The following are sample documents that may be used for general reference purposes only in connection with developing your Section 125 Cafeteria Plan. The documents below are samples only and should not be used without modification. In particular, please note that certain of these sample documents may not reflect changes required by the Affordable Care Act (enacted in March 2010). For a summary of those changes, log onto www.stepkaandassociates.com and go to HR Tools. Feel free to call us if you need help logging in.
Plan documents should always be developed in conjunction with a competent employment law attorney knowledgeable in employee benefits and/or a trusted professional group benefits expert with specialized experience in developing Section 125 documents.
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