Serving Employers Nationwide (Remote Implementation)
Leverage IRS Section 125 "Cafeteria Plans" to legally reduce your employer payroll tax liability while providing valuable pre-tax benefits to employees.
Section 125 of the Internal Revenue Code allows employers to offer "Cafeteria Plans"—benefit programs that let employees choose from a menu of qualified benefits paid for with pre-tax dollars. This reduces both the employee's taxable income and the employer's FICA tax liability on those wages.
When structured properly, Section 125 plans provide a legal, compliant pathway to significant payroll tax savings. Unlike temporary tax credits, Section 125 has been part of the IRS code since 1978 and provides permanent, ongoing savings year after year.
The FICA Advantage Program leverages Section 125 (along with related code sections §105 and §213(d)) to create a benefits-based FICA reduction strategy. This isn't a loophole or scheme—it's an established tax structure used by thousands of employers nationwide.
Employee contributions to qualified benefits are deducted before FICA taxes are calculated.
This reduces the total taxable payroll base for both employer and employee FICA contributions.
Employers save 7.65% FICA on every dollar that moves to pre-tax benefits.
Employees receive valuable wellness benefits while maintaining similar take-home pay.
This information is for educational purposes and does not constitute tax or legal advice. Section 125 plan requirements can be complex, and final eligibility and plan design should be confirmed through licensed tax and legal professionals. We recommend consulting with your advisors.
Get a free analysis to see how much your company could save through a properly structured Section 125 benefit program.