It is an employee benefit plan that allows employees to choose from various pre-tax benefits. These benefits include health insurance, dental insurance, vision insurance, life insurance, disability insurance, retirement plans, and flexible spending accounts (FSAs) for healthcare and dependent care expenses. The name "cafeteria plan" comes from the idea that employees can choose the benefits they want, similar to how they would choose items from a cafeteria menu. By offering a cafeteria plan, employers can give their employees more flexibility and control over their benefits while potentially reducing their payroll taxes.
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Everything You Need To Know About Cafeteria Plans
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