The Champ Plan | Section 125

Help employees keep more of what they earn—while your business enjoys tax savings.
The Champ Plan™ is a modern employee benefit program structured under IRS Section 125, giving your team access to valuable supplemental healthcare benefits while reducing your company’s payroll tax liability. (Pre-Tax Health Benefit Solution Under IRS Section 125)

💡 What Is the Champ Plan?

The Champ Plan™ is a Section 125 Cafeteria Plan that allows employees to set aside a portion of their salary pre-tax to cover eligible health-related expenses. In return, employers can lower their FICA and FUTA tax liabilities, all while providing a high-perceived-value benefit with minimal cost.

✅ IRS-Compliant
✅ No Net Out-of-Pocket for Employees
✅ Boosts Take-Home Pay
✅ Reduces Employer Payroll Taxes

📊 How the Champ Plan Works

1. Employees enroll in the program and opt into pre-tax payroll deductions.
2. Those dollars are used to purchase health benefits like telemedicine, accident insurance, and wellness services.
3. No money is lost—employees receive 100% value in benefits, and employers save on every participating employee.

This plan is fully compliant with IRS Section 125 and is administered by a third-party benefit provider to ensure legal and tax compliance.

✨ Key Benefits for Employers

• Save up to $500 per employee per year in payroll taxes
• No setup cost or minimum participation required
• Enhances benefit package without increasing costs
• Fully administered plan—minimal HR lift
• Attract and retain top talent with a richer benefits offering

👥 Why Employees Love It

• Access to real benefits: telehealth, medical concierge, wellness programs
• No net cost to them—salary stays the same, benefits increase
• Pre-tax dollars lower taxable income = higher take-home pay
• Fast enrollment, easy access, and ongoing support

🔒 Is It IRS Compliant?

Yes. The Champ Plan™ is fully compliant with Section 125 of the Internal Revenue Code and follows all applicable rules regarding pre-tax payroll deductions and benefit eligibility. It’s administered by third-party professionals who handle plan documentation, employee communications, and ongoing compliance.

📈 The Financial Impact: A Real-World Example

🧠 Who Is The Champ Plan™ For?

• Small to midsize businesses seeking to reduce payroll taxes
• Employers without major medical plans who still want to offer benefits
• Teams with part-time or hourly workers
• Companies with 1099 contractors (ask about custom structures)

✅ Start Offering The Champ Plan™

Schedule a free consultation with The Policy Shop to see how The Champ Plan™ can transform your employee benefits while improving your bottom line.