LOGICAL%20DEDUCTIONS,%20LLC

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LOGICAL DEDUCTIONS, LLC

• 167 Cherry St.
• Suite 159
• Milford, CT 06460
• Keith Weindling
• 203-268-9295

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Flexible Spending Health Care Dependent
CareTransit Benefits
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FLEXIBLE BENEFIT EXAMPLES

• Medical Co-Pays
• Prescription Co-Pays
• Dental Co-Pays
• Eye Glasses
• Contact Lenses
• Chiropractor

• Dependent Care
• Day Care Expense
• Transit Expense (Train)
• Parking Expense
• Hearing Aid
• Counseling

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What is a Flexible Spending Account?

• A Flexible Spending Account is an easy way for
• participants to pay for health care, dependent
  care,
• and transit expenses that are not covered by
  another
• benefits plan through payroll deductions on a
  pre-tax
• basis. The program is governed by the IRS.

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Why Offer Flexible Spending Accounts?

• Saves participants and clients money
• FSA deposits are made on a pre-tax basis
• EMPLOYERS save on matching FICA contributions and
  offer an excellent fringe benefit to all
  employees.
• PARTICIPANTS save on Federal, State, and local
  income taxes, as well as FICA Taxes.
• Encourages participants to make appropriate
  health care spending decisions

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FSA Tax Savings Example
With FSAs Without FSAs Gross
Salary 35,000 35,000 Health, Dependent,
and Transit Expenses Paid Through the FSAs
5,000 -0- Taxable Salary 30,000
35,000 Taxes (30) 9,000 10,500
Health, Dependent, and Transit Expenses Not
Paid Though the FSAs -0-
5,000 Take-home Pay 21,000 19,500 Empl
oyee Savings 1,500

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FSA Tax Savings Example
With FSAs Without FSAs Gross
Salary 35,000 35,000 Health, Dependent
Care, and Transit Expenses Paid Through the
FSAs 5,000 -0- Taxable
Salary 30,000 35,000 Taxes (30)
9,000 10,500 Health and Dependent Care
Expenses Not Paid Though the FSAs -0-
5,000 Take-home
Pay 21,000 19,500 Employer Savings 382.50
per employee

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Health Care Reimbursable Expenses

• Medical, dental and other expenses not covered by
  participants health plan
• Deductibles and co-payments, if applicable for
  participants plan or participants spouses plan
• Vision expenses (contact lenses, lasik surgery,
  eyeglasses, eye exams, etc.)
• Hearing expenses (hearing exams, aids)
• Psychotherapy, counseling

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Dependent Care Reimbursable Expenses

• Licensed nursery schools, day camps, day care
  centers
• Services from individuals who provide care inside
  or outside participants home (care provider may
  not be participants dependent or a child age 13
  or younger).

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Transit and Parking Expenses

• Qualified transportation expenses generally
  include payments for the use of mass
  transportation (train, subway, bus fares are
  typical examples).
• Parking expenses include the costs of parking a
  vehicle in a facility that is near the employees
  place of work or parking at a location from where
  the employee commutes to work. (for example, the
  cost of parking in a lot at the train station so
  that the employee can continue their commute on
  the train)

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FSA Contribution Amounts

• Health Care FSA
• Plan Maximum is set by employer
• Dependent Care FSA
• Plan Maximum is 5000
• Transit Expense Guidelines
• Parking Transit

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IRS Limitations

• Use it or lose it (national forfeiture rate is
  only 5)
• Uniform coverage
• Limited opportunity to revoke or make new
• elections

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Family Status Changes

• marriage or divorce
• birth or adoption of a child
• death of a dependent or spouse
• loss of a dependent childs eligibility
• commencement or termination of your spouses
  employment
• change in employment status (from full-time to
  part-time or vice versa)
• unpaid leave of absence taken by you or your
  spouse

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FSA Plan Fees

• One Time Plan Setup 350.00
• Annual Renewal N/C
• Monthly 35.00 Base 3.50 per
  participant
• All checks sent directly to each employee.
  Reimbursements may be submitted monthly.

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Employer Savings Example of
Employees ____10____ Health Care
Contribution ___6,000___Dependent Care
Contribution ___10,000__Total Employee
Contributions ___16,000__Annual Employer
Savings (FICA 7.65 x total contributions) ___1,
224___Estimated Annual Fees ____840____TO
TAL EMPLOYER SAVINGS ___384___Flexible
Savings Plans are an excellent benefit to all
employees !!In this example, each employee is
also saving over 450 (1600 in pre-tax
contributions times FICA FIT SIT )