Transcript Document

The Benefits of
Flex
ABC Employer
2005 Plan Year
February 1 – January 31
7/16/2015
Pacific Administrators
1
Today’s Purpose





7/16/2015
Introduce the Concept of Pre Tax
Benefits
Eligible Benefits: POP & FSA’s
How the Plan Works
What’s Next:
Your Responsibilities at Open
Enrollment
Common Q & A’s
Pacific Administrators
2
Tax Free Benefits

A quick review of how taxes affect your
pay.


Section 125 allows benefit costs to be
withheld pre-tax.


7/16/2015
Your gross pay is taxed first, then your
costs of benefits are withheld. You’re
taxed on your entire pay.
Your benefit costs are deducted from
your gross pay first, then you’ll be taxed
on the remaining amount.
Bottom line: You’ll save money with flex!
Pacific Administrators
3
Your Flex Plan Benefit
Choices


7/16/2015
Premium Only Plan (POP)
Flexible Spending Accounts (FSA)
Pacific Administrators
4
Premium Only Plan

Your cost of eligible benefit
premiums can be withheld pre-tax,
such as:
Group health, dental and vision
insurance premiums.
 Certain voluntary insurance
premiums.


7/16/2015
You’ll immediately benefit by
having more take home pay due to
lower taxable wages.
Pacific Administrators
5
Flexible Spending
Accounts

Child/Dependent Care FSA


Health Care FSA

7/16/2015
Expenses you incur for the care of
your child or dependent that allows
you to work.
Out of pocket expenses for you
and your family such as co-pays,
deductibles, glasses, prescriptions,
chiropractic and dental care.
Pacific Administrators
6
Child/Dependent Care
FSA





7/16/2015
Child care expenses up to age 13;
Or, care of a dependent that is
physically/mentally incapable of caring
for him/herself;
The expense must be work related;
Maximum exclusion is $5000 per year for
one or more dependent;
Remember that you can not claim the
child care credit if you pre tax the
expense.
Pacific Administrators
7
Health Care FSA




7/16/2015
You can include expenses for you and
your family, regardless of the health plan
they may be enrolled in.
Estimate the typical out of pocket
expenses you will incur during the plan
year. Maximum exclusion is $3000.
Do not include expenses that would be
for cosmetic purposes (face lifts or teeth
bleaching).
New in 2004, you can include many of
the over-the-counter drugs/medicines
(vitamins and supplements are ineligible)
Pacific Administrators
8
How the Plan Works


7/16/2015
Once a year you determine the
amount you would like to elect for
each Flexible Spending Account.
The amount you elect is divided by
the number of pay cycles you
have, and withheld in equal
amounts throughout the plan year.
Pacific Administrators
9
Getting Reimbursed



7/16/2015
As you incur eligible expenses for
services that have been rendered,
submit a copy of the bill, invoice, EOB or
other statement in the voucher
envelopes provided.
Reimbursement requests should be
processed within a few days of the
following payroll cycle.
Your flex check can be a “direct deposit”
(form on back of enrollment form) or
standard check.
Pacific Administrators
10
Reimbursement Details


7/16/2015
The Dependent Care FSA will
reimburse you up to the balance in
your account.
The Health Care FSA will
reimburse you up to the amount
you’ve elected for the plan year,
regardless of account balance.
Pacific Administrators
11
Important Details



7/16/2015
You may only enroll during open
enrollment, or upon initial benefits
eligibility.
You are enrolling for the plan year, all
expenses must be incurred within the
plan year.
Once you’ve enrolled, your election
amounts can not be stopped or changed
unless you experience a qualifying
“status change.”
Pacific Administrators
12
More Details….


7/16/2015
Use it or lose it – unused amounts
are forfeited, so consider your
election amounts carefully.
By taking advantage of the plan,
you’ll pay less in payroll taxes.
This may result in a nominal
reduction in your eventual Social
Security Benefits.
Pacific Administrators
13
Next Steps



7/16/2015
Review the packets provided –
they provide full details and
worksheets to assist you.
Complete and submit your
enrollment form.
If you are already on the plan and
are re-enrolling, a custom form will
be provided to you to make
enrollment even easier.
Pacific Administrators
14
Contact Information

The plan recordkeeper is Pacific
Administrators. They can be
reached by:
Telephone 800-427-4549
 Fax 951-656-9276
 Email: [email protected]
 Please call if we can answer any
questions!

7/16/2015
Pacific Administrators
15
Q & A’s

Will I be taxed on reimbursements?


Can I include expenses for my family?


Yes, expenses for your spouse and
dependents are qualified under the plan.
Can I enroll in the plan now and stop later in
the year?

7/16/2015
No. Reimbursements are tax free!
Generally no. When you enroll in the plan, it is
for the entire plan year. You are not permitted
to stop or change election amounts unless you
experience a qualifying “change in status.”
Pacific Administrators
16
Q & A’s

How do I know what my account balance is?


You’ll receive a statement with each
reimbursement and at the end of each month.
What if I change employment?

You may submit expenses for an extended
period of time. See plan documents for details.
For full details and plan information, please refer
to the Plan Documents and Summary Plan
Descriptions.
7/16/2015
Pacific Administrators
17