- TPS Group
- Areas Served
- Lynn, MA
- Benefits Plus
- Premium-Only Plans
Premium-Only Plans in Lynn, MA
POP plans are limited scope Section 125 plans that allow employers to pay health insurance premiums without FICA taxation. Employees also save by paying their portion of health insurance premiums with pre-tax income.
TPS Group offers customized Premium Only Plans (POP) for small businesses in Lynn, MA & surrounding states. If you’re a small business looking to save on taxes, a POP could be the perfect fit. Section 125 of the IRS code allows small businesses to make a simple change to the company’s payroll process that reduces employees’ taxable payroll. Every employees’ premium contribution through a premium only plan can be deducted from the overall taxable payroll amount.
What is a Premium Only Plan?
When combined with group health insurance, POPs pay a portion of employees’ insurance premiums on a pre-tax basis, which reduces their taxable income. As a result, a Premium Only plan reduces the income amount used to determine your payroll taxes as well. A POP offers a win-win situation for employers and employees alike.
Benefits of POPs in Lynn, MA
The Premium Only Plan is the building block of the Section 125 Plan. It allows for certain employee-paid group insurance premiums to be paid with pre-tax dollars. A few benefits of POPs are:
- Lower Employer Taxes
- Lower Employee Taxes
- Easy set-up
- Happier Employees
- More Take-Home Pay
Who can sponsor a POP Plan?
Any employer can sponsor a Premium Only Plan. Regular corporations, partnerships, S corporations, limited liability companies (LLCs), sole proprietors, profession corporations, and not-for-profits can all save money on payroll taxes by establishing a Premium Only Plan. While regulations prohibit a sole proprietor, partner, members of an LLC (in most cases), or individuals owning more than 2% of an S corporation from participating in the POP, they may still sponsor a plan and benefit from the savings on payroll taxes.
If you’re interested in POPs, you may also be interested in:
- Flexible Spending Accounts in Lynn, MA
- Group Health Insurance in Lynn, MA
- Health Reimbursement Accounts in Lynn, MA
- Section 125 Cafeteria Plans in Lynn, MA
Related to: Payroll Provider in Lynn, MA, Payroll Processing in Lynn, MA
Further Reading: Premium-Only Plans
Resources
Internal Revenue Service (IRS)
- Federal tax laws, rules and forms
- Businesses and individuals
- Independent contractor rules for IRS
U.S. Department of Labor (DOL)
- Federal wage and hour law
- Exempt and non-exempt employee status
- Compliance assistance
- Independent contractor rules for DOL
Employee Benefits Security Administration
Benefit plan compliance and assistance (health and retirement) COBRA HIPPA
Affordable Care Act Information and Health Insurance Marketplace
U.S. Bureau of Labor Statistics (BLS)
Labor statistics & wage data