United Benefit Advisors Insight and Analysis Blog

New ACA Implications for Cafeteria Plans: Change in Status and Changing Employee Elections

Posted by: Danielle Capilla    Jul 21, 2015 12:00:00 PM

Cafeteria plans, or plans governed by IRS Code Section 125, allow employers to help employees pay for expenses such as health insurance with pre-tax dollars. Employees are given a choice between a taxable benefit (cash) and two or more specified pre-tax qualified benefits, for example, health insurance. Employees are given the opportunity to select the benefits they want, just like an individual standing in the cafeteria line at lunch.

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Topics: employee benefits, section 125 plans, PPACA Affordable Care Act, Danielle Capilla, cafeteria plan, IRS Code Section 125