What does less Other Cafe 125 mean on my taxes?

What does less Other Cafe 125 mean on my taxes?

These cafeteria plans allow employees to set aside pre-tax income for certain employer-offered benefits. Benefits provided by plans covered under section 125 include adoption and dependent care assistance, health insurance, 401k and group term life insurance policies.

What does CAFE mean in Box 14 of W-2?

Café 125 aka IRC Section 125 aka (Pretax) Health Insurance. Unless you live or work in the State of New York, this information is only that – information. You don’t need to enter it, and it won’t go anywhere.

How do I report a cafeteria plan on my W-2?

Your employer may report your cafeteria plan deductions in Box 14, which is labeled “Other.” It might use the code “Section 125” or “Café 125,” and then state your pretax payments. This data is optional and can clear up any confusion you have about the amount in Box 1.

Is a cafeteria plan pre-tax?

Employee contributions toward cafeteria-plan benefits are made pre-tax. Employer contributions toward an employee’s cafeteria-plan benefits are not taxed.

What does CAFE mean on my W2?

Cafeteria
Cafeteria, or Section 125 plans include employer-sponsored benefits that are exempt from federal and typically, state taxes. Your employees pay for these benefits with pre-tax money, which you don’t include in their taxable wages on their annual W-2s.

What is Cafe on my paycheck?

What Is a Section 125 (or Cafeteria) Plan? A Section 125 plan is part of the IRS code that enables and allows employees to take taxable benefits, such as a cash salary, and convert them into nontaxable benefits. These benefits may be deducted from an employee’s paycheck before taxes are paid.

What does less other cafe mean on my W-2?

SECTION 125 is your employer’s benefit plan. It is also known as a “cafeteria plan”. Usually, what is reported there is your medical insurance premiums that are paid with pre-tax income. They are not taxed and are not included in your W-2 Box 1 wages so you can not deduct them as medical expenses.

What does CAFE mean on a W-2?

Cafe 125 on a W-2 tax form refers to a cafeteria plan, in which an employer offers workers a choice between various job benefits. These benefits can include medical insurance, life insurance, adoption assistance, assistance with care for dependent elderly relatives, extra paid vacation days and similar.

What does less other cafe mean on W-2?

It is also known as a “cafeteria plan”. Usually, what is reported there is your medical insurance premiums that are paid with pre-tax income. They are not taxed and are not included in your W-2 Box 1 wages so you can not deduct them as medical expenses.

Are health insurance premiums included on W-2?

Your health insurance premiums paid will be listed in box 12 of Form W2 with code DD.

What does other Cafe 125 mean on a W2?

What does less other cafe mean on w2?

What is less other cafe on W-2?

Why is Box 1 and Box 16 different on my W-2?

Some employees may see a difference between Box 1 Federal Wages and Box 16 State Wages due to the value of certain pre-tax transportation benefits.

What is the difference between a premium only plan and a cafeteria plan?

Cafeteria plans have different levels of benefits. A premium-only plan (POP) allows employees to pay their portion of insurance on a pretax basis. The flexible spending account (FSA) version allows for out-of-pocket qualified expenses to be paid pretax, which is the style of the plan described above.

What taxes are cafeteria plans exempt from?

Generally, qualified benefits under a cafeteria plan are not subject to FICA, FUTA, Medicare tax, or income tax withholding.

Is pre-tax health insurance reported on W-2?

Any medical premiums you pay with pretax dollars aren’t counted in your taxable income. When your employer prepares your W-2, your employer won’t include these premiums in box 1, your income subject to federal income tax. Instead, your employer reports the amount of the premiums in box 12 with the code DD.