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How does an Extra $625
in Spending Money sound?

It's Tax Time! While this may not be your favorite time of year, it’s a great time to talk with your tax advisor about options to minimize your tax bite and put more cash in your pocket. The flexible spending (flex) plans your company offers can do just that. It’s simple and convenient. And yes, it’s completely legal.

Your company’s flex plans allow you to pay for eligible medical, dependent care and commuting expenses on a pre-tax basis. This means you pay less tax on your gross monthly income, and put more in your take-home pay. Best of all, you have money set aside for medical bills, unexpected illness, daycare expenses or daily commuting expenses.

For an example of the tax-savings possibilities, see the chart below.

Enrollment in medical flexible spending accounts takes place annually at your company's open enrollment period. Depending on your company's renewal date, this could be mid-year or on a calendar year. Check with your HR department to find out more about your company's dates and the plans that they offer. (For Transportation or Parking Plans, you can enroll at any time of the year).

If you missed your opportunity this year, we encourage you to look at your expenses, find out more about the plans your company offers, and enroll next year to make sure you receive every eligible tax benefit.


Great Tax Savings

 

Without a Flex Plan

With a Flex Plan

Annual Income

$40,000

$40,000

 Contribution to Account
(before taxes)

$0

$2,500

 Taxes Paid
(estimated at 25%)

$10,000

 $9,375

After-Tax Income

$30,000

 $30,625

Increase in Annual
After-Tax Income

 

$625

     
Example savings for illustration only, based on typical salary, tax and flex contribution values. Your results may vary.

Estimate your possible tax savings at www.mgis.com/cdh and use the MGIS Employee Flex Calculator.

Here are brief descriptions of flexible spending plans that may be offered at your company:

Flexible Spending Account: Allows you to set aside pre-tax dollars up to $2,500 each plan year to pay for eligible medical expenses not covered by insurance or reimbursed from any other source. Your FSA election is pre-funded so you get access to your entire election amount on the first day of your plan year. Your election amount is loaded on to a VISA debit card to use at the point-of-sale eliminating the need to pay twice.

Dependent Care Account: Allows you to set aside pre-tax dollars up to $5,000 each plan year to pay for eligible day care expenses. Your dependent care is funded with each payroll giving you access to your funds the moment they become available.

Transportation Passes: Allows you to set aside pre-tax dollars up to $245 per month to pay for eligible transportation passes. Your transportation plan is funded with each payroll giving you access to your funds the moment they become available.

Qualified Parking: Allows you to set aside pre-tax dollars up to $245 per month to pay for eligible parking passes. Your parking plan is funded with each payroll giving you access to your funds the moment they become available.

Premium Reimbursement Account: Allows you to use pre-tax dollars to pay for individually owned, qualified insurance policies for you, your spouse, and any tax dependents not sponsored by an employer. Not all policies are qualified.

Put more of your hard-earned cash in your own pocket by talking with your tax advisor, reviewing your finances and enrolling in these tax-savings plans. See your HR administrator for more details and open enrollment time periods.

 
the mgis companies. Insurance Physicians Expert