Answers:
1.
What is a Cafeteria Plan?
The
Cafeteria Plan is a federally regulated program that allows employees
to set up payroll deducted insurance premiums on which income taxes
do not have to be paid, resulting in a tax savings for the employee.
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2.
Do I ever have to pay back the tax savings?
No.
3. What will it cost me to participate in the Cafeteria Plan?
No administrative fees will be assessed the employee.
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4.
How much will my tax savings be?
The
savings is based on the amount of insurance for which you are paying.
The higher your premiums, the more tax savings you will realize. The
amount of savings will depend on your tax filing status and the total
amount of premiums paid
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5. What
restrictions are placed on employees who participate in the Cafeteria
Plan?
1.
The medical insurance deduction taken on the cafeteria plan cannot be
itemized on your personal tax return.
2.
Once you enroll in the Cafeteria Plan, you must remain in the plan for a full plan year, and you must have all allowable insurance premiums in effect as deductions to calculate your tax savings. This means you cannot
cancel or change any insurance used in the program during the plan year, except for a qualifying
event (i.e., death, birth, marriage or divorce).
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6. What
is the Plan Year?
The
Plan Year is the same as the LSUHSC-S fiscal year, July 1st through
June 30th.
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7. May
I make changes in the Cafeteria Plan once I sign the participation form?
Only
certain circumstances allow changes to be made. A change in family
status (marriage, death, birth of a child, divorce) and any health
insurance group rate change affective the monthly premium rate will
allow changes to be made.
A
participant who incurs a change in family status shall have a Special
Enrollment Period, which shall begin on the date of his/her family
status change, and shall terminate thirty (30) days thereafter.
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8.
May I cancel the Cafeteria Plan for any other reason?
No. The regulations require you to keep the same insurance deductions
for this Plan Year. During Annual Open Enrollment of each year, you will be permitted to
make insurance changes for the new Plan Year, or get out of the Cafeteria
Plan. If you become disabled, quit, or retire, your Cafeteria Plan
participation will be terminated.
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9. What
do I need to do to enroll in the program and begin receiving these tax
savings in my paycheck?
Complete and sign
the Salary Reduction Agreement for the Cafeteria Plan and return it
to the Benefits Section of Human Resource Management, Room 108 of
the Administration Building.
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10.
Who do I contact for questions about the Cafeteria Plan?
The staff in the
HRM Benefits Section will be glad to help you. Contact us at 318-675-5614.
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