Small Company Question - 403(b) & Health Ins

[ABC]

From a health insurance stand point there should be no problems as long as the non profit is meeting contribution requirement for a health plan.

I have set up half dozen church plans this way.

What I would do on the health plan side is set up a multi choice plan where the employer contribution satisfied 50% mark on a base health plan. Then have a buy up option that employee can pay for.

There are obstacles with this approach. You really need to pay the entire health premium unless these non profit employee are being compensated.


I don't know why all of you guys are talking about booze?

 

[scagnt83]

How could you give each employee 10% and give them discretion how to use it? You could give them a "benefit bonus" or increase their salary by 10%, although that would let them decide how to allocate their dollars, it would also allow them to do nothing as intended and buy beer instead.

I've used putting money into a Section 125 plan as a bonus for each employee, but that wouldn't work for retirement plan contributions, just health insurance and other 125 plan qualified benefits.

Discretionary doesnt necessarily mean that they can spend it on whatever they want. In the OPs case it would be the discretion to have the money go to either HI or to their 403b.

The employees are basically getting a 10% bonus each year.
Currently that 10% bonus is going to the 403b.

If the employer chooses.
At the beginning of the year they can give the employee the choice of allocating that 10% to their HI premiums, or to their 403b.

But as I said before, it would be an accounting & administrative nightmare.