Pre-tax Savings Opportunities
Cafeteria Plan (Section 125 Plan)
Participating in any of FirstFleet’s group health benefits such as the medical plan, dental plan or vision plan has additional financial advantages. Employee benefit plans, where you can contribute a portion of your gross income before taxes are deducted, are called Cafeteria Plans or a Section 125 Plan.
What Does This Mean?
Cafeteria Plans include (but are not limited to): insurance benefits, our 401(k) Plan, Health Savings Account contributions and Flexible Spending Account contributions.
- Because contributions to Cafeteria Plan options come out of your paycheck on a pre-tax basis, your total taxable income is lowered, reducing income, Medicare and Social Security taxes. This means you benefit from an increase in your take-home pay.
- Keep in mind, the government imposes certain rules and requirements for a Section 125 Plan such as ours. When you elect health coverage and pay for your benefit elections through pre-tax payroll deductions under the Section 125 Plan, you are subject to the government rules.