Since 2005, companies have been taking advantage of cafeteria plans to reduce payroll taxes. The Cypress Advantage Plan (CAP) is the latest innovation in this commonly used platform. It is a self-funded plan sponsored by a company that allows employees to contribute to the plan on a pre-tax basis.
This premier cafeteria plan improves on the traditional Section 125 Cafeteria Plan by significantly reducing payroll taxes for employers while also increasing and improving on the benefits offered to employees.
Every month, a portion of your employees’ income will be appropriated by the CAP, which will fund a Benefit Bank that they can use to purchase supplemental insurance policies such as Life Insurance, Gap Insurance, Critical Illness Insurance and more. Since this is a pre-tax contribution, the contribution your employees make will also reduce the total number of taxable wages you have to report under FICA.