While a Premium Only Plan may be a generally simple plan to administer when compared to other tax-savings plans, there are certain compliance requirements that must be met. For example:
- Do you have a plan document?
- Do you perform annual non-discrimination testing on the plan?
- Do you have a Summary Plan Description you distribute to each employee participating in the plan?
- Do employees complete election forms to participate or waive enrollment in the plan?
- Do you have participant’s complete Change of Status forms when they change the amount they have deducted mid-plan year to conform to qualifying change of status reasons?
If you cannot answer yes to these questions, your plan will not pass a Department of Labor audit.
Why SBA for your POP Administration?
Sound Benefit Administration will provide you with a Section 125 Premium Only Plan that will meet all the compliance requirements so you can continue to offer this valuable benefit to employees.
We remind you every year of your annual compliance responsibilities in order to allow employees to pay their portion of insurance premiums with pre-tax dollars. Our knowledgeable staff will help you perform non-discrimination testing on your plan and distribute required paperwork to participants. We can help employees understand the benefits and cautions to pre-taxing their premiums to make an informed decision before electing or waiving this benefit.
Annual checklists are included to remind you of what is required each and every year to in order to keep your plan in compliance. The cost is minimal, the benefit is great.
How do you get started?
Talk to your benefits broker today about working with SBA on your POP administration.