What is a Cafeteria PlanWritten by articlewriterus57
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There are several features which are offered along with the Cafeteria plan which is beneficial for the employee. There can be several kinds of benefits like the accident cover, health insurance, maternity benefits which are covered under this plan. Under the Cafeteria plan there is an agreement which allows the employee to redirect their salary and this deduction is known as the pre tax deductions and so they are regarded as the benefit of tax saving for both the employer and the employees. Cafeteria plan is generally the plan which is especially designed for the employees and the staff members for their benefits, where the employees have the flexibility to select the best suitable plan from the various benefits offered like the health insurance, tax benefits, cash benefits and other retirement benefits. Just like the normal cafeteria where the employee have the flexibility to select the food of his choice in the similar way the employees also have the flexibility to select the benefits as per their choice and so the Cafeteria plan is also known as the Flexible benefit plan.
There are several medical expenses which can be reimbursed or which are eligible for the reimbursement under the Cafeteria plan are treatment of alcohol, consuming the pills for birth control, different accessories for blind person like eye dog, schooling expense and special trainings. Expensed on the different accessories for the deaf person like expense on special school and training, hearing aids can also be reimbursed under the Cafeteria plan. There are other medical expenses like dental check up fees, diagnostic fees, treatment of drug, eye check up and glasses, treatment to increase fertility, expenses on hospitalization and many more medical expenses which are covered and reimbursed under the Cafeteria plan.
Benefits of the Cafeteria plan
There are several benefits which are offered by the cafeteria plan as the benefits and advantages offered under this plan are exempted from the pre tax salary and so the taxable salary is decreased or reduced and so the take home amount also increases. The Cafeteria plan covers the general insurance and health insurance plans and not only covers the employee or the staff but these insurance and health plans also covers the dependent of the employees. Under this plan the several medical expenses are also reimbursed on the pre tax salary basis and so the taxable income is reduced with the enhancement in the net salary take home. The idea of cafeteria plan is appreciated and liked by Employees and the staff of the company as there can be several kinds of benefits like the accident cover, health insurance, maternity benefits which are covered under the cafeteria plan.