Section 125 for Employers
A smarter way to think about employee benefits.
NovaBacca Health helps employers understand how Section 125 strategies may create opportunities to improve employee benefits while reducing eligible payroll-related costs.
NovaBacca Health
A Division of NovaBacca Advisors
The basics
What is a Section 125 plan?
Section 125 allows qualifying employee benefits to be structured using pre-tax dollars.
Depending on the structure and the company's circumstances, this can potentially create advantages for both employers and employees — the employer may see an impact on certain payroll-related costs, while employees may gain access to benefits that would otherwise be paid for with after-tax dollars.
It is not a replacement for health insurance, and it is not a one-size-fits-all product. Specific outcomes depend on the employer's situation and professional review.
We do not make guaranteed tax or savings claims. Everything is reviewed against your actual company data before any recommendation is made.
Why employers care
Four reasons this conversation happens.
Reduce eligible payroll costs
Explore opportunities to reduce certain employer payroll expenses through compliant benefit structures.
Improve employee benefits
Give employees access to additional benefit options without simply increasing traditional compensation.
Support retention
A stronger benefits package can become part of an employer's overall retention strategy.
Create more value from existing payroll
Evaluate whether your current compensation structure can work more efficiently than it does today.
Who this is for
Could this work for your company?
Most employers we speak with recognize themselves in at least one of these.
- Employers with W-2 employees
- Growing companies adding headcount
- Organizations looking to manage benefit costs
- Companies evaluating employee retention strategies
- Businesses seeking to improve their overall compensation package
How it works
Four steps, starting with a conversation.
Discovery
We learn about your company, employee structure and current benefits.
Review
We evaluate whether a Section 125 strategy may be applicable to your situation.
Recommendation
You receive a clear explanation of the potential options and what they would involve.
Implementation
If it makes sense, the appropriate specialists help implement the solution.
Potential employer impact
Where value could potentially be created.
We describe areas of potential impact rather than promising a number, because the number depends entirely on your company.
Payroll-related savings opportunities
Certain employer payroll costs may be affected by how qualifying benefits are structured.
Additional employee benefit value
Employees may gain access to benefit options beyond what is offered today.
Improved benefit utilization
Structures are designed so that the benefits offered are actually used.
Reduced pressure on benefit budgets
More value from the same compensation dollars can ease pressure on traditional benefit spend.
Actual savings, eligibility and tax treatment depend on the company's circumstances and plan structure. Employers should consult appropriate tax, legal and benefits professionals.
Why NovaBacca Health
This isn't just about adding another benefit.
NovaBacca Health helps employers look at benefits through the lens of business performance. The goal is to identify strategies that make financial sense for the employer while also creating meaningful value for employees.
We are a division of NovaBacca Advisors, whose specialists have spent more than 20 years helping businesses reduce expenses and recover costs across shipping, utilities, payment processing, workers compensation, technology and more. Benefits are one part of a larger question: where is this business spending more than it needs to?
See the full suite at NovaBacca AdvisorsFAQ
Section 125, answered plainly.
Next step
Find out if Section 125 could make sense for your business.
A short conversation can help determine whether your company may be a fit.