Premium Only Plan Administration (POP) allow you to cut your payroll taxes without reducing your payroll!

The Section 125 Premium Only Plan (POP) saves you and your employees’ money by reducing payroll taxes. Once you have implemented a POP Plan your employees pay their portion of insurance premiums with pre-tax dollars rather than after tax dollars. The Employers taxable payroll is reduced by the total amount of the employee contributions for benefits in the POP Plan. This reduction in taxable payroll reduces the amount of FICA tax the employer pays.

  • Once implemented, a POP Plan allows employees to pay their portion of insurance premiums with pre-tax rather than after-tax dollars.
  • The employer’s taxable payroll is reduced by the total amount of employee contributions for benefits in the POP Plan, reducing the amount of FICA tax the employer pays.
  • Employees don’t pay FICA, federal or state and local taxes (if applicable) on money used to pay premiums through a POP Plan.
  • Participation will increase an employee’s take-home pay.