What Is A Section Plan

A section 125 plan is part of the irs code that enables and allows employees to take taxable benefits such as a cash salary and convert them into nontaxable benefits.

What is a section plan. It includes all necessary language to comply with 24 cfr part 135 of the u s. A plan offering only a choice between taxable benefits is not a section 125 plan. The direction of the plane through which the section is cut is often represented on plan drawings and elevations by a line of long and short dashes called a section plane.

Department of housing and urban development section 3. This resource provides a template for creating a section 3 plan. Section 125 is officially an irs pretax vehicle nicknamed cafeteria plan because employees can choose pretax benefits like medical or dental insurance or opt to receive the equivalent amount on their paycheck paying taxes on.

What is a section 125 plan. In the section view everything cut by the section plane is shown as a bold line often with a solid fill to show objects that are cut through and anything seen beyond generally shown in a thinner line. Plan drawings are in fact a type of section but they cut through the building on a horizontal rather than vertical plane.

A section 125 plan is the only means by which an employer can offer employees a choice between taxable and nontaxable benefits without the choice causing the benefits to become taxable. Section 125 plan. A cross section also simply called a section represents a vertical plane cut through the object in the same way as a floor plan is a horizontal section viewed from the top.

A section 125 plan is a written plan that allows participants to receive certain benefits called qualified benefits on a pretax basis. In a section 125 plan or cafeteria plan employees can pay qualified medical dental or dependent care expenses on a pretax basis which has the effect of reducing their taxable income as well as their employer s social security fica liability federal income and unemployment taxes and state unemployment taxes. If a section 139 plan is right for the employer after considering the alternatives then the next step is to design the plan.

The employer should evaluate.