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FSA can Benefit the Employer as well as Employee

The BASE® Flexible Spending Account is a good option that could provide extra funds during the expensive holiday months. The FSA is a BASE® product under the 125 Cafeteria Plan that employers can offer to their employees to help reduce the taxation on out-of-pocket medical expenses not covered under insurance plans. It is an easy way for employees to save tax dollars throughout the year by setting aside money from their paycheck on a pre-tax basis into a special account that can be used to pay for certain out-of-pocket medical expenses.

The FSA can work for many different kinds of employers. However, the ideal candidate is a company that has one or more employees who pay for qualifying non-insured medical expenses such as dental, vision, co-pays, deductibles, prescriptions, and chiropractic. Not to mention, a variety of other qualifying eligible expenses such as band aids, sunscreen, contact lenses, etc.

While this product greatly benefits the employee, it helps employers save money as well. When employees choose to participate in the plan it reduces the employers share of FICA and FUTA taxes on the elected amount. Employees have the opportunity to save tax dollars throughout the year on over 4,000 eligible expenses. The higher the plan utilization, the more the employer saves!

Leah L., an FSA client, realized the benefits the FSA provided to her employees. “We originally decided to implement the BASE® 125 plan for the tax savings it provided, and I would say that is the biggest benefit.  Not only do our employees save when funds are transferred from their wages on a pre-tax basis, but our company also sees valuable tax savings. Not everyone is great at saving for a rainy day, but this has helped many of our employees be able to save for medical expenses, both expected and unexpected. This plan is very user friendly for both the employees and employer, and I would definitely recommend taking advantage of the BASE® 125 plan.  The BASE® staff is very easy to work with, and is great at helping out in a very timely and efficient manner.”

One proven way to maximize participation is by simplifying the reimbursement process. BASE® offers a variety of ways to reimburse medical expenses including the swipe of a card or the use of a mobile device with photos of receipts. Colleen, another FSA client, mentions the benefits of the FSA for her company and the opportunity for employees to use a debit card. The debit cards make the process seamless and can increase participation. “Aside from the tax savings for both our firm and our employees, one of the biggest benefits is the debit card. It is extremely convenient to swipe the card at the point of service for covered items and services.”

Contact BASE® today to see how your company or clients can start saving today with the BASE® FSA!

DCAP Offers More Than You Think

The BASE® Dependent Care Assistance Plan, also known as a Dependent Care FSA, is a plan established by an employer that allows employees to set aside money from each paycheck, on a pre-tax basis, to pay for qualifying dependent care.  This money can help for qualifying dependent care expenses such as daycare, preschool, and before and after-school care...

...But did you know that it also helps to pay for elder care?

By the year 2040 (that's only 23 years from now) the percentage of people aged 65 and older will have nearly doubled to 22%, up from 13% in 2010.  Yet, the past few years has seen little growth in the number of employers offering benefits for employers who care for older and disabled relatives (Innovative Employers Enhance Caregiver Benefits). 

In a study by ReACT, a coalition of more than 40 companies and non-profits dedicated to addressing the challenges faced by employee caregivers and reducing the impact on their employers, on Emory University in Atlanta, revealed that 15% of respondents were currently taking care of an adult family member.

"Nearly 60% of those people expressed concern about managing the care of an adult loved one in the next one to three years," explains Audrey Adelson, Emory's manager of work-life.  (Innovative Employers Enhance Caregiver Benefits).

Do you, or your clients, know that by implementing this BASE® 125 Cafeteria Plan into their business, their employees will not have worry about the costs of taking care of their mother, father, or spouse?

Dependent care to many employees or employers equates to daycare, so how can it be used for elder care?  Keep reading!

Who is eligible to use DCAP for elder care?

  • A participant must be at work during the time the eligible dependent receives care
  • Participants must have a spouse, or a dependent parent who is physically or mentally unable to provide for his/her own care

Who is considered an eligible senior dependent for reimbursement?

  • Your spouse, or a dependent parent, who is mentally or physically incapable of caring for himself/herself and who lives with the participant for more than half of the year

What kind of care is eligible for reimbursement?

  • Inside or outside the home by anyone other than the member's spouse
  • In a dependent care facility which meets all applicable state and local regulations
  • By a housekeeper whose services include, in part, providing care for a qualifying individual

No matter what the company, or size, the Dependent Care Assistance Plan is a reality.  The employer is able to offer an enhanced benefits package that can help with recruitment and retention of employees, and financial benefits from the reduction of the employer's share on payroll taxes.  The employee gets the peace of mind they deserve; continuing to work and establishing funds to help pay for the cost of dependent care.  Since these funds are transferred on a pre-tax basis, the employee is able to increase their take-home pay. 

Contact BASE® today to learn more about this and other money saving benefit strategies by visiting our website or calling 1-888-386-9680.