Download - Micro Provider Overview
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Tax Savings for the Small Business Owner
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Agenda• Rising cost of healthcare• AgriPlanNOW & BizPlanNOW HRA Plans• How do HRAs work?• FlexSystem FSA Plans• TASC offers peace of mind• Simple. Successful. Guaranteed• Microbusiness Compliance Suite• Questions
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Rising cost of healthcare• According to The Kaiser Family Foundation’s Employer
Health Benefits Annual Survey published in 2013, and titled, “Cost of Health Insurance,” the average annual premium for family coverage in 2012 is $15,745
• There has been an increase in average family premiums of 134% since 1999
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Rising cost of healthcare• One in five families reported they experienced serious
financial problems due to family medical bills in the past 12 month period.
• 27% put off or postponed getting needed medical care.• 34% reported skipping dental care or checkups.
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Rising cost of healthcare• 2.3 trillion* in 2008• $4.6 trillion* by 2019 • Every year more and more Americans lose
their health insurance for one simple reason: they can’t afford it.
*Source: Centers for Medicare & Medicaid Services“National Health Expenditure Projections 2009-2019” – November 1st, 2010
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Save your self-employed clients $5,000 a year!
Perfect fit for:• Family farmers• Truckers• Real estate agents/brokers• Small retail establishments
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What is a Section 105 HRA?• Section 105 is a 1954 tax law that allows for family
employment• Converts normal insurance and out-of-pocket
expenses into an employee benefit program and becomes 100% deductible!
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HRAs are alive and well!
• Are employer-sponsored HRA Plans still legitimate?
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How do HRAs work?
15.0 % Federal tax rate
5.2 % State tax rate15.3 % Self-
employment tax35 % Total tax rate
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2014 ComparisonWith Section 105
Premium Deduction 100%$9,299 x 100% = $9,299
Federal, State & SE Tax Rate$9,299 x 35.3% = $3,255Tax Savings = $3,255Non-Insured Expenses 100%$5,362 x 100% = $5,362Federal, State & SE Tax 35.3%Tax Savings $1,877Total Expenses $14,661Total Deduction $14,661
Total Tax Savings$5,132
Without Section 105Premium Deduction 100%$9,299 x 100% = $9,299
Federal Tax Rate $9,299 x 15% = $1,395Tax Savings = $1,395Non-Insured Expenses 0%$5,362 x 0% = $ 0
Federal & State TaxTax Savings = $ 0Total Expenses = $14,661Total Deduction = $9,299
Total Tax Savings $1,395
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Who qualifies?• Sole Proprietor• Partnership• C-Corporation• Non-Profit• Limited Liability Company• S-Corporation
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Employers without Group Insurance can still offer pre-tax benefits
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IRS Notice 2013-54
• A company with more than one eligible employee will no longer receive a tax advantage through a HRA unless it sponsors group insurance
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TASC has a solution• No Limit Plan • Non-Employer Sponsored Premium (NESP)• Non-Excepted Health FSA Plan (NEFSA)
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No Limit Plan• The No Limit Plan is a self-funded health Plan that
meets all Healthcare Market Reform requirements. • There is no limit to the amount of insurance premiums
or out-of-pocket medical expenses that can be reimbursed to your family-member employees.
• The following are reimbursable expenses under the No Limit Plan: – Insurance premiums– All out-of-pocket medical expenses
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No Limit Plan• Disclaimer: No Limit Plan increases risk to the
business– Please be aware that the No Limit Plan could expose your
business to an additional risk: having a high amount of medical claims written off through your business.
– If you have employees who are not family members, this type of benefit Plan is not recommended.
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Non-Employer Sponsored Premium• Employers May Continue to Reimburse Employees
for Individual Premiums
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Non-Employer Sponsored Premium• TASC’s Non-Employer Sponsored Premium Account
(NESP) is designed for employers and employees to contribute tax-free dollars toward individual health insurance.
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Non-Excepted Health FSA Plan
• Both employers and employees may contribute tax-free dollars to help employees pay for eligible out-of-pocket medical expenses
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FlexSystem FSA• Section 125 Cafeteria Plan• Pre-Tax Dollars• Flexible Spending Accounts
• Medical• Dependent Care• Transportation• Insurance Premiums
• Save between 25% and 40%• Reduced Payroll Taxes
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FlexSystem FSA
Annual Salary: $35,000Out-of-Pocket Medical/Dental Expenses: $ 1,000/yearOut-of-Pocket Dependent Care Expenses: $ 2,500/year Without FSA With FSA
Gross Pay $ 35,000 $ 35,000FSA Contribution - $ 0 - $ 3,500Taxable Income $ 35,000 $ 31,500Taxes (Fed, State, FICA) - $ 10,500 - $ 9,450Out-of-Pocket Expenses - $ 3,500 - $ 3,500Reimbursement from FSA + $ 0 +$ 3,500Take-Home Pay $ 21,000 $ 22,050
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Who qualifies?
• Greater than 2% Shareholders of S-Corporations are excluded.
• Highly compensated employees are excluded.
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SIMPLE Cafeteria Plans• Provides new opportunities for some owners and
highly compensated employees to participate where they could not in the past.
• A FSA Plan with no discrimination testing, but with a required employer contribution.
• For groups under 100 employees.
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SIMPLE Cafeteria Plans• Employer contributions to a SIMPLE Cafeteria Plan
must be sufficient to provide benefits to non-highly compensated employees.
• Employers must choose one of the following contribution methods: – Uniform Contribution: A uniform percentage (at least 2%) of
compensation, whether the employee does or does not make salary reduction contributions to the plan; or
– Matching Contribution: The lesser of 2x the employee’s annual contribution, or 6% of the employee’s annual compensation.
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TASC offers peace of mindThese comprehensive and innovative employee benefit plans have been specifically designed for this new regulatory environment.
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TASC offers peace of mind• In-house Legislative Analyst to ensure we make any
necessary adjustments to your Client’s Plan features to protect their tax savings.
• AgriPlanNOW and BizPlanNOW include everything you need to ensure your Client’s Plan meets documentation and compliance requirements with IRS, DOL, ERISA
• FlexSystem Clients can add on additional compliance features– Non-Discrimination Testing– 5500 Paperwork Filing– PCORI service
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Simple. Successful. Guaranteed!• Industry exclusive Audit Guarantees for AgriPlanNOW
BizPlanNOW and FlexSystem.
• Money Back Guarantee for AgriPlanNOW and BizPlanNOW.
• FlexSystem offers daily reimbursement floating of Uniform Coverage Dollars.
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Simple. Successful. Guaranteed!• Innovative TASC Card lets your Clients pay for your
out-of-pocket medical expenses with the swipe of a free debit card.
• Carry Over unused medical expenses.• Online tools.
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Simple. Successful. Guaranteed!• MyBenefits
– TASC Card qualifies and pays eligible expenses on the spot
– Purchases are limited to healthcare merchants under your Plan
• MyCash– Reimbursements are fast and convenient– Use MyCash funds just like cash at any retailer
that accepts major cards.– Withdraw at an ATM or transfer to a personal
account.• Mobile App
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Simple. Successful. Guaranteed!• National presence with local expertise.• Unique field force model which supports our Providers
by assisting at multiple stages of the sale.• Industry and market education and training.• Dedicated, trained Customer Care staff provides
service through multiple channels.• Microbusiness Inside Specialist team dedicated to
helping you qualify and enroll your Clients.
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Microbusiness Compliance Suite
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Welfare Benefit Plan Compliance• The Department of Labor (DOL) has jurisdiction over ERISA
compliance• If you provide a Welfare Benefit Plan (such as group insurance)
then you must have a Summary Plan Description (SPD)• You may have plan documents from several providers, but these
are not a SPD.– A SPD merged all single plan document into 1 summary document – SPDs must be distributed to employees in a timely manner and be accurate &
up to date• Failure to provide a plan participant with an SPD within 30 days of
an employee request carries a maximum $110 per day penalty
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ERISAEdge• Prepare all required documents
– Plan Document, Summary Plan Description, Summary of Material Modification, Summary Annual Report and the IRS Form 5500 preparation (if applicable).
• Assistance during a Department of Labor (DOL) audit.• Ensure timely disclosure of Plan changes to employees.• Monitor legislative and regulatory changes, ensuring the Plan is
up-to-date.• Automatically distribute all amendments due to regulatory updates
to Plan Participants.• Maintain all required records for the mandated amount of time.• Share guidelines for disclosing required information to employees.
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HIPAA Compliance• Assists in compliance with HIPAA requirements.• Provides a cost-effective compliance solution.• Removes burden of researching compliance need, creating
documentation, and more.• Fosters peace of mind that comes with ensured compliance with
HIPAA regulations.• Helps employers avoid fines and penalties.• Provides easy-to-understand materials and directions for
maintaining compliance with HIPAA Privacy and Security rules.• Stays abreast of changing regulations.• Provides toll-free customer service.
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Contact us• Call: 888-595-2261 Ext. 17732 • E-mail: [email protected]• Visit: www.tasconline.com/partner/information-
request/