BASE^® Blog

The Limited Purpose FSA works like a regular FSA but is limited to the number of eligible expenses it can be used for.  But just because the name starts with the word, “limited,” it doesn’t mean it is limited in the potential tax savings and benefits to both employer and employees. 

The BASE® Limited Purpose Flexible Spending Account (LPFSA) is a special type of flexible spending account (FSA) that is available to employees, enrolled in a Health Savings Account (HSA), to put aside money, on a pre-tax basis, to pay for eligible dental and vision expenses.

With the LPFSA, the employer can take advantage of its benefits.  The employer can find additional ways to maximize savings and tax benefits for the business and employees.  It may seem that by limiting the reimbursements to only dental and vision care, that it isn’t much, but with the employee electing to make pre-tax contributions, it reduces the employer’s share of FICA and FUTA taxes and enhances the employer’s benefits package.   

The LPFSA benefits are not limited to only the employer, but to the employees as well.  The employees can see an increase in take-home pay due to funds being transferred on a pre-tax basis, saving on Federal, State, Social Security, and Medicare.  The Limited Purpose FSA allows for the employee to pay for the dental and vision expenses, while saving their HSA funds for future medical expenses, building HSA funds, or investment opportunities.

By using the LPFSA first, participants have the opportunity to build contribution amounts in their HSA while still receiving a pre-tax benefit for eligible dental and vision expenses.  For more information about the BASE® LPFSA or the BASE® HSA call 888.386.9680 or visit www.BASEonline.com.

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Imagine this: you’re sitting in a meeting with your client, discussing their business, finances, and other needs.  John, your client, tells you that he wishes there were a way to help him, his business, and employees, save on the continuous rise in the cost of health care.  Because you are a BASE® Business Partner, you say, ”Let me show you how much you can save in valuable tax dollars each year with BASE®!”  Their ears perk up, and because you have become a trusted advisor, they are ready to listen and begin saving thousands in valuable tax dollars!

In that meeting with John, you are presented the opportunity to take advantage of being a BASE® Business Partner, offering your client more than another advisor would be able to, helping you stay competitive in the marketplace that you serve, not to mention, the opportunity to boost your business and increase your bottom line.

As you show John how much he could be saving in valuable tax dollars each year, John is thankful to you for uncovering thousands of dollars that can now be turned around and used for the portfolio of services you offer. 

You assure John that BASE® is committed to his plan and that they will always be up to date with all government regulations, the latest state insurance laws, and other regulations that could affect how John does business.  John asks, “I understand this will save me, as an employer, valuable tax dollars, but how will it help my employees?”

You explain to him that by implementing one of the tax-advantaged plans available through BASE®, he is now providing an additional value-added benefit option to help retain and attract employees.  His employees will benefit too with:

• Tax-free reimbursements
• A secure online portal that can meet all needs
• Personalized top-notch customer service when questions arise

At the end of the meeting, you shake hands (or bump elbows), knowing that you just helped another client save thousands in valuable tax dollars, while providing an attractive health benefits package to their employees.  Whether your client has one employee or hundreds, BASE® provides you with every available resource to help you become more knowledgeable about the products and services that will help benefit your clients.  You know that if there is a time where a client asks a question that you are not fully prepared to answer, that BASE® is just one phone call, or one email, away from answering any question.

BASE® will help you offer your clients the tax savings necessary to help combat the skyrocketing costs of health care, maximize health benefit plans, and build excellent rapport between you with your clients.  For more information on becoming a BASE® Business Partner, call 888.386.9680 or visit www.BASEonline.com.

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It has been a full year since the Excepted Benefit HRA has been available for businesses.  Unlike the name suggests, the EBHRA offers much more than just the reimbursement of “excepted benefits” in ways of INTEGRATION, DESIGN, & ELIGIBILITY.

The BASE® Excepted Benefit HRA (EBHRA) allows employers, who offer a group health plan, to reimburse employees an additional $1,800 for premiums paid towards excepted benefits that are not included in a traditional group health plan.  Some excepted benefits are COBRA, dental, vision, short-term medical plans, and other qualifying out-of-pocket medical expenses.

The BASE® EBHRA is available to businesses of ALL sizes looking to maximize tax benefits for their business while expanding the benefit package for their employees.  This HRA is for employees that have been offered the employer-sponsored group health plan but are not required to enroll to participate in the EBHRA.

In 3 ways the EBHRA offers more:

INTEGRATION:

While other HRAs, such as the Individual Coverage HRA (ICHRA) and Integrated HRA, must integrate with either an individual health insurance plan or the employer-sponsored group health plan, the EBHRA does not.  The sponsoring employer MUST OFFER the EBHRA in conjunction with the employer-sponsored group health plan, however, the employees are not required to enroll in the group health plan to participate in the EBHRA. 

Simply put, if the employer wants to provide the EBHRA to their employees, they must offer an employer-sponsored group health plan.  It is up to their employees if they want to participate or not.

DESIGN:

The EBHRA is designed for uniform availability meaning it must be offered on the same terms and conditions to all eligible employees.  The employer gets to determine what expenses to reimburse and how much will be reimbursed up-to the maximum of $1,800 (indexed for inflation) per plan year to employees. 

Simply put, the employer must provide the EBHRA to all employees, but can choose how much they will provide up-to $1,800. 

ELIGIBILITY:

Final regulations leave the assumption that the employees eligible for the EBHRA must be eligible to enroll in the employer-sponsored health plan, even if they choose not to.

Simply put, the employees must be eligible for the employer-sponsored group health plan, but do not need to enroll to take advantage of the tax savings with the EBHRA. 

With the EBHRA, we want you to experience the BASE® Difference!  With BASE®, employers will have an additional way to maximize their tax benefits for the business and their employees, by providing a tax-free means of paying for COBRA, Short-Term Limited Duration Insurance, and Excepted Benefit Insurance and/or IRC Section 213(d) medical expenses.  Employees will have up-to an additional $1,800, tax-free, to apply towards these benefits.

Simply put, the EBHRA can offer benefits to both the employer and employee, allowing both to maximize their tax savings.  For more information, call BASE® at 888.386.9680 or visit www.BASEonline.com.

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