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  1. #1
    Join Date
    Feb 2006
    Location
    riverside
    Posts
    150

    Default Cafeteria Flex Plan 125

    Hello Im from California. My husband's employer offers the the Flex plan
    Cafeteria plan 125. Sounds great my question is how would this affect my tax refund next year? I am just using the Medical not the dependant on the Flex plan because I wanted to save the dependant to file the child credit for my taxes.
    I just wanted to know if using the flex plan will make me pay taxes or diminish my refund by a large margin.
    thank you so much

  2. #2
    Join Date
    Oct 2006
    Posts
    16,474

    Default Re: Cafeteria plan 125

    Quote Quoting verde
    View Post
    Hello Im from California. My husband's employer offers the the Flex plan
    Cafeteria plan 125. Sounds great my question is how would this affect my tax refund next year? I am just using the Medical not the dependant on the Flex plan because I wanted to save the dependant to file the child credit for my taxes.
    I just wanted to know if using the flex plan will make me pay taxes or diminish my refund by a large margin.
    thank you so much
    I am not sure that I understand your question. What does a dependent for the purposes of medical insurance have to do with a dependent for tax purposes?

    Make sure that you aren't confusing issues and therefore denying your child(ren) coverage they need.

  3. #3
    Join Date
    Apr 2007
    Posts
    62

    Default Re: Cafeteria Flex Plan 125

    Agreed, your posting is unclear so you need to calarify it.

    Just FYI, a Section 125 Cafeteria plan uses pretax dollars or makes the amount you put towards the plan non-taxable for income tax purposes. It also has the effect of lowering your adjusted gross income (AGI), thereby giving you a favorable effect on those items that are AGI dependent. I do believe that the full amount of wages is taxable for Social Security and Medicare purposes, unless you exceed the Social Security threshhold, then Social Security wages, as represented on your W-2, will max out at the threshhold, which is getting near $100,000 these days.

  4. #4
    Join Date
    Feb 2006
    Location
    riverside
    Posts
    150

    Default Re: Cafeteria Flex Plan 125

    Hi,
    I will try to clarify...I do have medical insurance for myself and my family.

    I would use the cafeteria Flex plan 125 for things that medical insurance doesnt cover like dental expenses,crowns, dental bridges,eye glasses,ect...

    My question is how does this affect me when I make my taxes for next year.
    Will I have to repay the taxes I saved during the year on the Cafeteria plan 125?? THANK YOU FOR YOUR IMPUT

  5. #5
    Join Date
    Oct 2006
    Posts
    16,474

    Default Re: Cafeteria Flex Plan 125

    Quote Quoting verde
    View Post
    Hi,
    I will try to clarify...I do have medical insurance for myself and my family.

    I would use the cafeteria Flex plan 125 for things that medical insurance doesnt cover like dental expenses,crowns, dental bridges,eye glasses,ect...

    My question is how does this affect me when I make my taxes for next year.
    Will I have to repay the taxes I saved during the year on the Cafeteria plan 125?? THANK YOU FOR YOUR IMPUT
    You pay for the cafeteria plan with pre-tax dollars. Therefore those dollars do not show up in your gross wages on your W2, and are never subject to income tax. Therefore there is nothing to "repay".

    That has absolutely no effect whatsoever on dependency exemptions or child tax credits. Any impact it has on your tax return will be a positive rather than a negative impact.

  6. #6
    Join Date
    Feb 2006
    Location
    riverside
    Posts
    150

    Thumbs up Re: Cafeteria Flex Plan 125

    WoW....thank you so much!
    I LOVE THIS PLACE>>>>

  7. #7
    Join Date
    Sep 2008
    Posts
    1

    Default Re: Cafeteria Flex Plan 125

    How does flex plan 125 affects our Social Security?

  8. #8
    Join Date
    Oct 2006
    Posts
    16,474

    Default Re: Cafeteria Flex Plan 125

    Quote Quoting BenCord
    View Post
    How does flex plan 125 affects our Social Security?
    It has no effect on social security.

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