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Section 125 plan

The Premium Only Plan (POP) is the most common of all cafeteria plans. It’s most often used in conjunction with the other cafeteria plan types (e.g., Flexible Spending Account). In a POP, the employees’ portion of group health and other premiums is payroll deducted on a pre-tax basis, resulting in lower income taxes. Below are examples of the premiums that can be deducted pre-tax. You can only deduct for employer-sponsored plans for which you pay at least a portion of the premium.

Group insurance premiums that you can pre-tax include:

  • Accident Insurance
  • Group Health Insurance
  • Cancer Insurance
  • HMO Insurance
  • Dental Insurance
  • Intensive Care Insurance
  • Disability Insurance
  • Vision Insurance
  • Group Term Life Insurance