Flex Examples
Flex Examples

In this example, the employer saves by having a flexible benefits plan where employees can redirect expenses for their employer sponsored health insurance premiums, child or elder care, and other medical expenses not covered by their insurance.

Employer Savings

(Based on 50 employees, average $2,000 per month salary)

 

Payroll Costs without 125 Plan

Payroll Costs with 125 Plan

EE Salary

$2,000

$2,000

EE 125 Plan Contribution

0

300

Taxable Salary

2,000

1,700

FICA at 7.65%

153

130

Worker's Comp. (Est. 5%)

100

85

Total Per EE Payroll

2,253

2,215

Monthly Per Employee Savings

 

38

Annual Per Employee Savings

 

456

     

EMPLOYER SAVINGS THE FIRST YEAR

 

$22,800

Note: This example reflects what a married employee with one dependent would save by having their contributions for health insurance premiums deducted before taxes.

Employee Savings

 

Without Premium Only

With Premium Only

     

GROSS SALARY

$2,000.00

$2,000.00

Less Medical Premium

0

100.00

     

TAXABLE INCOME

$2,000.00

$1,900.00

Federal Taxes

403.00

372.53

State Taxes*

113.00

104.01

State Disability*

15.87

15.07

Social Security

122.97

116.77

Medicare

28.76

27.31

Less Medical Premium

100.00

0

    

SPENDABLE INCOME

$1,216.40

$1,264.31

Note: This example demonstrates a monthly savings of $47.91 and an annual savings of $574.92.

* These items are based on the tax table.

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