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The Benefits of Flex

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Today’s Purpose

Introduce the Concept of Pre Tax Benefits

Eligible Benefits: POP & FSA’s

How the Plan WorksWhat’s Next: Your Responsibilities at Open Enrollment

Common Q & A’s

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Tax Free Benefits

A quick review of how taxes affect your pay.

Your gross pay is taxed first, then your costs of benefits are withheld. You’re taxed on your entire pay.

Section 125 allows benefit costs to be withheld pre-tax.

Your benefit costs are deducted from your gross pay first, then you’ll be taxed on the remaining amount.

Bottom line: You’ll save money with flex!

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Your Flex Plan Benefit Choices

Premium Only Plan (POP)

Flexible Spending Accounts (FSA)

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Premium Only Plan

Your cost of eligible benefit premiums can be withheld pre-tax, such as:

Group health, dental and vision insurance premiums.

Certain voluntary insurance premiums.

You’ll immediately benefit by having more take home pay due to lower taxable wages.

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Flexible Spending AccountsChild/Dependent Care FSA

Expenses you incur for the care of your child or dependent that allow you to work.

Health Care FSA

Out of pocket expenses for you and your family such as co-pays, deductibles, glasses, prescriptions, chiropractic and dental care.

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Child/Dependent Care FSAChild care expenses up to age 13;

Or, care of a dependent that is physically/mentally incapable of caring for him/herself;

The expense must be work related;

Maximum exclusion is $5000 per plan year, calendar year and household, year for one or more dependent. If married filing separate tax returns, the maximum is $2500. Please see guidelines for details.

Remember that you can not claim the child care credit if you pre tax the expense.

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Health Care FSA

You can include expenses for you and your family, regardless of the health plan they may be enrolled in.

Think about upcoming dental, vision, healthcare and prescription expenses you will have.

Do not include expenses that would be for cosmetic purposes (face lifts or teeth bleaching).

Over the counter drugs & medicines are not eligible unless your doctor has provided you with a written prescription and you have it filled at a pharmacy.

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How the Plan WorksOnce a year you determine the amount you would like to elect for both the Health FSA and the Dependent Care FSA.

Remember to consider the types of dental, vision, and other health expenses you and your family may have. We have worksheets to assist you in estimating your election.

The amount you elect will be divided by the number of pay cycles you have in the plan year, and will be withheld in equal amounts - tax free.

Then as you incur expenses, you’ll claim them and be reimbursed tax free!

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Getting ReimbursedAs you incur eligible expenses you may fax, email, or mail the expense and claim form to PayPro Administrators. Itemized receipts must accompany the claim. Claims should show the nature of service, the date the expense was incurred, your cost, who provided the service, and the individual the expense refers to.

Upon receipt of your claim, please allow us up to 3 business days to have it reviewed and entered for reimbursement.

Reimbursement checks & direct deposit statements are processed on scheduled days for each plan. You may have a direct deposit or a regular check.

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More Reimbursement DetailsIf your plan has the PayPro BenefitsCard, you can use it at the point of sale to pay for the expense automatically. Save all itemized receipts when using the card. Many expenses that you pay with the PayPro BenefitsCard will require us to obtain additional substantiation. If you do not submit those receipts upon request, your card will be suspended and future claims will be applied to cover those unsubstantiated items!

The PayPro BenefitsCard only has the ability to process and approve claims without additional substantiation when it is a direct co-pay match amount. This is easily done with prescription drugs that match your insurance co pay amount. Dental and vision expenses, as well as expenses outside the normal co-pay amount always need to be substantiated. Again, save your itemized receipts!

The Dependent Care FSA will reimburse you up to the balance in your account.The Health Care FSA will reimburse you up to the amount you’ve elected for the plan year, regardless of account balance.

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Important Details

You may only enroll during open enrollment, or upon initial benefits eligibility. If you are enrolling for a short plan year, please write the amount you would like to pre tax each pay period - OR - for the remainder of the plan year.

All expenses must be incurred within the plan year.

Once you’ve enrolled, your election amounts can not be stopped or changed unless you experience a qualifying “status change.”

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More Details….Use it or lose it – unused amounts are forfeited, so consider your election amounts carefully.

If you find you have monies remaining in the account and the year is close to ending, go spend it! Purchase additional contact lenses, get your teeth cleaned, etc. Don’t lose it!

By taking advantage of the plan, you’ll pay less in payroll taxes. That’s awesome, right? This may result in a nominal reduction in your eventual Social Security Benefits.

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Next Steps

Review the packets provided – they provide full details. Worksheets and detailed information can be found at www.pagroup.us

Complete and submit your enrollment form.

If you are already on the plan and are re-enrolling, a custom form will be provided to you to make enrollment even easier.

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Contact Information

The plan recordkeeper is PayPro Administrators. They can be reached by:

Telephone 800-427-4549

Fax 951-656-9276

Email: flex@pagroup.us, Claims@pagroup.us

Please call if you have any questions or need assistance!

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Q & A’sWill I be taxed on reimbursements?

No. Reimbursements are tax free!

Can I include expenses for my family?

Yes, expenses for your spouse and dependents are qualified under the plan.

Can I enroll in the plan now and stop later in the year?

Generally no. When you enroll in the plan, it is for the entire plan year. You are not permitted to stop or change election amounts unless you experience a qualifying “change in status.”

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Q & A’sHow do I know what my account balance is?

Go to www.pagroup.us and click on Flex Plans, then Employee Information. You’ll see a login for balance review!

What if I change employment?

You may submit expenses that were incurred prior to your date of termination for an extended period of time. This may be as little as 30 days - so don’t delay! See plan documents for details.

For full details and plan information, please refer to the Plan Documents and Summary Plan Descriptions.