How will a Flex Plan benefit me?
By participating in a Flex Plan, you will not have to pay State or Federal income tax or Social Security on your elections! Uncle Sam does not get a share of the money! Let us look at one employee and see how he saved on taxes by participating in a Flex plan. Here is the employee's situation:
- Salary: $2,500 a month
- Withholding: 28% for federal withholding and 7.65% for Social Security
Before participation in the Flex plan, the employee paid the following:
- Monthly premium for health insurance: $348
- Out-of-pocket medical expenses: Monthly average of $100
- Day Care Expenses: $200 a month
The employee decided to pay for the premiums through the Flex plan, to put $100 a month in a Health FSA and $200 a month into the Dependent Care Expense Plan.
To see how this employee saved $230 a month or $2,760 a year by participating in his Flex plan, click here.
Last update on May, 16 2013 by Administrator.