Tax Free Premiums

At TaxFreePremiums we understand that creating your POP is only the first step, which is why we’ve created a simple, easy-to-follow checklist to ensure you set up your plan correctly. We provide all the materials you’ll need to implement your plan. Let us help you get your company in complete compliance!

A Premium Only Plan can be started at any time during the year. The plan must be a written document and notice of the plan must be given via Summary Plan Descriptions (SPD) to eligible employees. Many states require employers to sponsor a Section 125 POP if the employer requires the employees to pay any portion of their premiums. However all employers are required to have a Section 125 POP if they are deducting premiums on a tax-free basis.

Most plans are established on a calendar year basis however, the employer may also decide to start a short Plan Year at any given time. This is often a temporary option if the company or the employees want to start a Section 125 POP mid-year that coincides with the calendar year. For instance, if the plan year is January 1 to December 31 and the employer sponsors the plan in mid May it is possible to arrange for a short plan that will be effective June 1 to December 31 of the present year.