Wednesday, October 1st, 2014
A pre-tax benefit can come in a variety of shapes and sizes, but usually can fit into one of two categories.
Most are benefits that an employee elects to pay for by using a portion of his or her compensation that would have otherwise been taxed as salary. The other category consists of benefits paid by your employer on a take-it-or-leave-it basis for which you are not taxed.
Pre-tax benefits usually are provided either within a cafeteria plan or separately.
Cafeteria plan pre-tax benefits
A cafeteria plan is a written plan under which all participants are employees who may choose among two or more benefits consisting of cash and qualified benefits.
Qualified benefits include:
- Accident or health plan coverage;
- Dependent care assistance;
- Contributions to a cash or deferred arrangement such as 401(k) plans; and
- Taxable and nontaxable group-term life insurance.
In general, the benefits that may be offered under a cafeteria plan are those that are not includable in the employee’s gross income because of a specific Internal Revenue Code provision. However, cash, group-term life insurance on an employee’s life in excess of $50,000, and group-term life insurance on the lives of the employee’s spouse or dependents may be provided under a cafeteria plan even though they are taxable. Employees are not taxed on taxable options offered under a cafeteria plan unless they elect to receive them.
Other pre-tax fringe benefits
Employees are taxed on fringe benefits unless the benefits are specifically excluded from income by the Internal Revenue Code. Benefits that are specifically not included in an employee’s taxable salary include:
- Benefits that can be offered in a cafeteria plan, but are instead offered separately;
- No-additional-cost services (“excess-capacity” services offered for sale to customers);
- Employee discounts;
- Working condition fringe benefits (for example, the use of a company car for business);
- De minimis fringe benefits (benefits too small to count, such as occasional personal use of the company photocopier, or an occasional free ticket to a sporting event);
- Qualified moving expense reimbursements;
- Qualified retirement planning services; and
- Qualified transportation fringe benefits (including van pooling, transit passes and qualified parking, up to specified dollar limits).
In connection with the last item-qualified transportation fringe benefits-either the employer can fund this benefit directly for everyone or only those employees who choose to receive this benefit can have a portion of their salary used to fund it.
Flexible spending accounts
A flexible spending account (FSA) can either form part of a cafeteria plan or it can be offered as a separate pre-tax fringe benefit. Either way, its purpose is to use funds that would otherwise be paid out as taxable salary to pay for certain benefits on a pre-tax basis.
An FSA is an arrangement under which an amount is credited to an account from which an employee may be reimbursed for health care, dependent care or other expenses that are excludable from gross income if paid by an employer. A separate account must be set up to pay for each type of expense, and the account cannot be drawn upon in any way other than for reimbursement of that type of expense. Beginning in 2013, an FSA for health care costs cannot exceed a $2,500 annual limit, as required under the Affordable Care Act.
The account may be funded by employer contributions or by a salary reduction agreement. An FSA can be a cafeteria plan if it is funded by a salary reduction agreement or otherwise allows employees to choose to receive cash instead of a qualified benefit. It is not a cafeteria plan if employees are not given this choice.
Please contact us if you have any questions about taking advantage of pre-tax fringe benefits.
Tuesday, September 23rd, 2014
On Saturday, September 20, 2014, the Atlanta Office participated in the 2014 Metro Atlanta Heart Walk and 5k. Our team of 28 people raised over $2,500 for the American Heart Association, and walked to promote physical activity and to build healthier lives, free of cardiovascular disease and stroke.
Friday, September 12th, 2014
Mauldin & Jenkins was a sponsor for the 2014 GCAPP Empower Party hosted by Jane Fonda. Cocktails, dinner, and the Atlanta World premiere of This is Where I Leave You were enjoyed at the High Museum of Art & Rick Theatre on Thursday, September 11. MJ Alexander and Alesia Howell from our Atlanta office attended the event and even managed to snap a photo op with Jane Fonda herself!
Monday, September 8th, 2014
The Family Medical Advocate Project is Project Giving’s primary emphasis and our year-round initiative. We “Build Bridges of Hope” for families who are suffering from chronic medical illnesses.
Project Giving “RETRO NIGHT GLOW” 5K/10K/1 Mile fun run, 70’s/80’s concert, & kids’ fest, is Project Givings annual fall fund raising event. It is held annually during the month of October and is a Family Fun Event for ALL ages. The festivities took place this past Saturday, September 6 in Macon, GA! For more information about Project Giving and the event, visit their website.
Eight people from the Albany office participated in the run/walk, and 11 who volunteered to work before the event stuffing participant packets or during the event cheering and providing traffic assistance at a mile maker.
Justin Bradley won 1st place in the 10k for his age bracket
Grant Davis won 2nd place in the 10k for his age bracket
Adam Blakely won 3rd place in the 10k for his age bracket
Fred Martin won 3rd place for 5 k for his age
Ally Marshal (Ron’s wife) and Justin Johnson both finished the 5 k in the top 32% of 446 5 k participants.
A big thanks to our participants from the Albany office! Not only did they help give back to the community, but it looks like they had some fun too! Take a peak at some photos from the night’s events:
Friday, September 5th, 2014
Kimberly Haynes, Ashton Pellicano, Garrett Landreneau and Lauren Payne represented M&J at the UGA Meet the Firms on September 4th. Thank you to everyone who stopped by our booth! We look forward to being back on campus for interviews September 23rd.
Thursday, September 4th, 2014
Brian Carter, Partner at the Bradenton office and Karen Jubrail, VP of Development at Glazer Children’s Museum partnered to teach the class, “Your Financial Statements – A Donor’s Prospective” at the 4th Annual Not for Profit Workshop, held August 26th at the David A. Straz Center for the Performing Arts. 85 Attendees enjoyed their interactive presentation– There was a lot of note taking and the duo answered many questions, as well as provided some solid advice.
The Not for Profit Workshop is a gathering of non-profit leaders and philanthropists focused on improving the quality of life in the Tampa Bay area communities.
Thursday, September 4th, 2014
Mauldin & Jenkins staff challenged our Managing Partner, Donny Luker and our Atlanta Partner-in-Charge, Jeff Fucito to the ALS Ice Bucket Challenge. Our fearless leaders endured the ice-cold water dumped over their heads with smiles on their faces! Not only did Donny and Jeff accept the challenge, but they also gave a donation.
Donny and Jeff have officially challenged our other Partners-in Charge: John McDuffie in Albany, Jerry Marlar in Bradenton, Warren McEwen in Chattanooga, and Hanson Borders in Birmingham! You have 1 week to complete the challenge or donate!
Click on the photo or HERE to watch the video!
Thursday, August 28th, 2014
The M&J team spent the morning of August 20th volunteering at the Food Bank of Manatee helping sort, weigh and package dry and canned foods, getting the items ready for delivery to local non-profit agencies such as food pantries, soup kitchens and churches. The team also donated $75 and a combined 54 pounds of food and baby items.
Everyone got a little sweaty and some of us escaped to the walk-in freezer a few times to cool off, but our volunteers enjoyed the opportunity to help others. Hard work was rewarded in the form of a Council’s burger…compliments of PIC Jerry Marlar.
For information on how you can donate or volunteer to the Food Bank of Manatee, visit their website.
We look forward to again volunteering at the Food Bank of Manatee!
Wednesday, August 20th, 2014
Summer is the season for conventions! Mauldin & Jenkins recently exhibited and sponsored the Leading Age Florida Convention held in Orlando from July 27th to July 30th. Representing M&J was Brian Carter, Linda Corty and Holly Littlefield.
Mauldin & Jenkins also exhibited and sponsored the Florida League of Cities Convention held in Hollywood, FL from August 14th to August 15th. Representing M&J was Daniel Anderson and Holly Littlefield.
Friday, August 15th, 2014
Mauldin & Jenkins: Birmingham helped raised funds and collected school supplies for the Hands On Birmingham Back-To-School Backpack Drive. The backpacks and supplies were donated to the YMCA, Salvation Army, Jessie’s Place and various other programs to send to schools and children in need.
Through the generosity of companies and individuals, Hands On Birmingham exceeded its goal by collecting over 1600 backpacks and still counting!
We want to thank all that participated and donated to this worthy cause. Way to go team!