Guest Posted February 9, 2001 Posted February 9, 2001 A corporation sets up a cafeteria plan so health insurance premiums can be paid pretax. To avoid violating the 25% key employee concentration test, only 1/2 of the premiums for key employees are paid through the plan. 100% of premiums for non-keys are paid through the plan. Is there a problem with this arrangement? Could the contributions and benefits test be a problem even if the concentration test is ok?
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