Integrated Benefit Solutions provides up to date IRS compliance documents backed by our partner attorneys to give employers protection against Internal Revenue Service violations as they pertain to the Cafeteria or Section 125 Premium Only Plans. All employer sponsored health plans that allow for pre-tax employee deductions must provide a Section 125 Summary Plan Description to their eligible employees or face penalties that can be far more costly than putting a plan document in place.


A cafeteria plan, also known as a section 125 plan, is a written plan that provides employees an opportunity to receive certain benefits on a pretax basis by allowing them to choose between receiving a taxable benefit (such as cash) or certain qualified benefits for which the law provides an exclusion from wages (such as health insurance).

A “premium-only-plan” (POP) is a basic type of cafeteria plan that allows for pretax health insurance premium contributions by employees. A POP plan offers as its sole benefit an election between cash (for example, salary) and payment of the employee share of the employer-provided accident and health insurance premium (excludible from the employee’s gross income). A Flexible Spending Arrangement (FSA) is another form of cafeteria plan benefit, funded by salary reduction, that reimburses employees for expenses incurred for certain qualified benefits, such as medical care.

Cafeteria plans must meet the specific requirements and regulations of Section 125 of the Internal Revenue Code, which generally include the development of a written plan describing the benefits and establishing rules for eligibility and elections, as well as satisfy various tests for nondiscrimination with respect to certain highly compensated and key employees. A cafeteria plan may generally make benefits available to employees, their spouses and dependents. It may also include coverage of former employees, but cannot exist primarily for them. For more on determining who qualifies as an employee for purposes of a cafeteria plan, please click here.

Qualified Benefits

Generally, a cafeteria plan does not include any plan that offers a benefit that defers pay. However, a cafeteria plan can include a qualified 401(k) plan as a benefit. Qualified benefits generally also include:

  • Accident and health benefits (but not Archer Medical Savings Accounts or long-term care insurance);
  • Adoption assistance;
  • Dependent care assistance;
  • Group-term life insurance coverage (including costs that cannot be excluded from wages); and
  • Health Savings Accounts (HSAs), including distributions to pay eligible long-term care premiums or qualified long-term care services.

Benefits that cannot be included in a cafeteria plan include de minimis benefits, educational assistance, transportation (commuting) benefits, tuition reduction, and working condition benefits. For information on other benefits that are not allowed to be offered under a cafeteria plan, please click here.

What’s included in our Premium Only Plan package from Integrated Benefit Solutions

You will receive:

  • Our industry low price; we urge you to shop around and if you find a better price, we will match it
  • Electronic PDF copies of all Section 125 related documents
  • A bound hard copy of the Master  Plan document

We have the lowest price for premium only plan descriptions verses that of our competitors. Please use the form on our contact page to order today.