UNLV Section 125 - Flexible Benefit Plan
UNLV's Section 125 plan provides an opportunity for employees to participate in a tax saving "Flexible Benefits" program that allows them to save dollars by pre-taxing deductions.
Health Insurance premiums are automatically pre-taxed. Employees who choose to purchase personal accident, personal indemnity, and cancer care insurance may also pre-tax these premiums by completing the Salary Redirection Agreement.
This program also benefits those employees that have dependent day care costs (DDC) and unreimbursed medical expenses(URM).
When payroll deductions are taken on a before-tax basis, taxable earnings are reduced by the amount of these deductions for the purpose of computing taxes. Because of this tax advantage, federal law restricts employees from making changes in their Section 125 benefit elections except during the open enrollment period, to be effective the following July 1st.
THIS MEANS YOU CANNOT ADD, DROP OR CHANGE YOUR BENEFIT ELECTIONS AT ANY OTHER TIME EXCEPT IN CASES OF:
1. Change in family status such as marriage, birth, divorce, or death.
2. Inadvertent loss of coverage due to loss of employment, age, etc.
The Unreimbursed Medical (URM) plan allows you to contribute pre-tax dollars into your reimbursement account through payroll deduction to help pay for health care services that are not reimbursed through your health insurance plan. Besides paying for these unreimbursed medical costs with pre-tax dollars, another advantage of this benefit is that it allows you to be reimbursed for eligible health care expenses prior to the funds being accumulated in your account - that's like an interest-free loan. The maximum contribution allowed under the UNLV URM plan is $6,000.00 for the plan year (July 1 to June 30)
The Dependent Day Care (DDC) plan allows you to contribute pre-tax dollars into your reimbursement account also through payroll deduction to pay for qualified expenses related to the care of dependent children age 12 or under. The maximum contributions allowed under the UNLV DDC plan is $5,000.00 for the plan year (July 1 to June 30). The advantage of this plan centers mainly around the ability to pay for these expenses on a pre-tax basis. With the DDC Plan, funds must have been deducted from your salary before they are available for reimbursment. Amounts reimbursed under this plan will not be eligible for the dependent care tax credit.
The disadvantage to these plans however is that if you do not spend the whole amount by the end of the plan year, you forfeit the remaining dollars. This is calle the "USE IT OR LOSE IT" provision.
The minimum monthly contribution to the URM and DDC Plans is $25.00.
You must sign up for this program within the first 60 days of your employment. There will be an open enrollment period in the Spring, generally in May. During this open enrollment, employees may enroll in the Section 125 plan, or cancel pre-tax deductions for the next calendar year.
Employees wishing to continue participation in either of the reimbursement accounts must re-enroll every year during the open enrollment period. There is no allowance for late enrollment.
