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Certification

• Introduction to BASE®
• 1. Who is BASE®?
  2. What is an HRA?
  3. Who Qualifies for an HRA?
  4. Where do the savings come from?
• BASE® 125 Cafeteria Plan
• 1. What is a 125 Cafeteria Plan?
  2. Who is eligible for the BASE® 125 Plan?
  3. Where do the savings come from?
• BASE® Integrated HRA
• 1. What is an Integrated HRA?
  2. Who is eligible for the BASE® Integrated HRA?
  3. Where do the savings come from?
• Value of BASE®
• 1. How can BASE® products help my sales?

Section II: BASE® 125 Cafeteria Plan

Chapter 3: Where do the savings come from?

The savings for a 125 Cafeteria Plan can be found for the employer and the employee. BASE® will provide a complimentary benefit analysis to show employers how much they could be saving with the funding options that best fits the needs of their organization.

Employer

FSA & DCAP – Even though this is considered an employer provided plan, the employee elects to make a pre-tax contribution for medical expenses or dependent care expenses that reduces the employer’s share of payroll taxes.

POP – The employer saves on the amount of matching FICA tax the employee has withheld from their paychecks on a pre-tax basis, and does not pay Medicare, Social Security, or unemployment insurance taxes on the amounts that employees chose to have withheld from their paychecks on a pre-tax basis. If only a few employees choose to take advantage of the ability to pay health insurance premiums with pre-tax dollars, the employer can still realize a net financial gain.

Employee

FSA & DCAP – Since these funds are transferred from the employee’s wages on a pre-tax basis, employees save federal, state, Social Security and Medicare taxes. By setting aside these dollars pre-tax, employees are able to increase their take-home pay.

POP – Participating employees benefit from the ability to pay their share of employer-sponsored benefit premiums, including health, dental, and vision, with pre-tax dollars through salary reduction. This saves employees Federal, State and FICA taxes. Depending on an employee’s family income, the amount of money that individuals can save by paying for health insurance this way is between 25-50% of their total insurance premium.

In short, the BASE® 125 Cafeteria Plan provides various areas of savings for both an employer and employee.

Employers may…

• realize FICA and FUTA savings through salary reduction
• save under state unemployment insurance and workers’ compensation laws
• contain health care costs in some cases
• offset additional premium cost

Employees may…

• realize increased take-home pay by reducing the amount of taxable income and pre-tax salary reduction elections

In the end, employers are able to add value and savings to their benefit package with one quick payroll adjustment. For employees, ultimately this benefit provides a tax savings while also helping to defray the cost of health care expenses.