Why Is IRS Code Section 125 Critical for Tax-Efficient Benefits?

Designing employee benefits that balance affordability with meaningful value has become a priority for modern organizations. One of the most powerful tools available for achieving tax efficiency in workplace benefits is irs code section 125. This provision in the U.S. tax code allows employers to structure benefit plans that reduce taxable income for both employees and businesses. When implemented correctly, 125 cafeteria plan benefits can significantly enhance take-home pay while lowering payroll tax obligations.

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