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Full Version: cafeteria plan vs. Welfare plan difference?
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Pecos
Medical:
If a group Health Insurance plan allows employees to deduct pretax premiums from their paycheck, does this automatically change it from a welfare plan to a cafeteria plan? Participant eligibility will continue to be based on the section 152 dependent rules.
Bill Presson
QUOTE (Pecos @ Jan 7 2009, 08:07 AM) *
Medical:
If a group Health Insurance plan allows employees to deduct pretax premiums from their paycheck, does this automatically change it from a welfare plan to a cafeteria plan? Participant eligibility will continue to be based on the section 152 dependent rules.


The insurance remains a welfare plan. In order to deduct premiums on a pretax basis, you need a cafeteria plan document, so you would have both.
GBurns
It is not the group health insurance plan that "allows employees to deduct pretax premiums from their paycheck". It is your employee benefits plan that adopted a cafeteria plan thereby allowing the pre-taxing.

Pecos
Would there typically be two 5500s for the two plans or just one 5500 filed as a welfare plan?
Bill Presson
QUOTE (Pecos @ Jan 8 2009, 10:33 AM) *
Would there typically be two 5500s for the two plans or just one 5500 filed as a welfare plan?



Just one (if required to file) for the welfare. Cafeteria plans aren't required to file anymore.
GBurns
Doesn't the cafeteria plan exemption depend on the size/number of participants ?
Pecos
It will be for around 200 employees
Bill Presson
QUOTE (GBurns @ Jan 8 2009, 12:20 PM) *
Doesn't the cafeteria plan exemption depend on the size/number of participants ?


I didn't word my reply very well. The requirement for filing the schedule F for cafeteria plans has been eliminated. In the situation presented, one 5500 is still all that is needed.
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