Section II: BASE® 125 Cafeteria Plan

Quiz 1: What is a 125 Cafeteria Plan?

1.A 125 Cafeteria Plan is a set benefit plan that does not allow for customizing benefits.

1. Answer: b. False

This plan allows employers to customize benefits and save money.

2.Which of the following does a 125 Cafeteria Plan allow employees to pay for?

2. Answer: d. All of the above.

Employers that sponsor a BASE® 125 Cafeteria Plan can allow employees who are paying medical expenses, insurance premiums or dependent care expenses to do so on a pre-tax basis.

3.The BASE® 125 Cafeteria Plan will only create savings opportunity for an employer.

3. Answer: b. False

A 125 Cafeteria Plan can create sizable savings for both the employer and employee through a combination funding options.

4.How many funding options are available through a 125 Cafeteria Plan?

4. Answer: c. 3

The BASE® 125 Cafeteria Plan offers four funding options with the FSA, DCAP, and POP.

5.Which BASE® 125 plan funding option allows for an employee to pay for a variety of employer-sponsored benefits with pre-tax dollars?

5. Answer: d. POP

Premium Only Plan (POP) allows for employees to pay for a variety of employer-sponsored benefits, such as health, dental, and vision with pre-tax dollars, ultimately reducing taxable compensation.

6.BASE® provides plan design, implementation and compliance services for the BASE® 125 Cafeteria Plan.

6. Answer: a. True

BASE® provides plan design, implementation and compliance services. Our staff is well trained in state-of-the-art planning and design techniques.

Congratulations!

You have successfully completed the BASE® Certification program.

You will be receiving a certificate of completion that will be mailed to your Agency Manager’s office.

For further questions, please contact BASE® at 1-877-342-5105 or visit us on the web at www.BASEonline.com.

Thank you for taking this quiz.

Continue to Section II: Chapter 2!