07 May The Champ Plan helps employers reduce payroll taxes.
Section 125 plan
Want to Save on Payroll Taxes The Champ Plan helps employers reduce payroll taxes. (Section 125 Plan)
Payroll Taxes: A Hidden Drain on Employer Profits
For every dollar you pay your employees, you’re also paying up to 7.65% in FICA taxes (Social Security and Medicare). Over the course of a year, that adds up fast. In fact, most employers spend thousands in payroll taxes for every full-time worker on staff.
But what if there was a way to reduce those costs while improving employee benefits?
Enter The Champ Plan™, a compliant, Section 125-backed strategy that helps businesses save significantly on payroll taxes — without cutting wages or benefits.
Businesses using The Champ Plan report an average payroll tax savings of $573 per employee, per year. Multiply that by 25, 100, or even 500 employees, and the ROI becomes impossible to ignore.
How Payroll Tax Savings with Section 125 Works
A Section 125 Cafeteria Plan allows employees to pay for certain qualified benefits with pre-tax income. By reducing the employee’s taxable wages, the employer pays less in payroll taxes like FICA.
The Champ Plan builds on this strategy by combining a pre-tax Minimum Essential Coverage (MEC) plan with a post-tax wellness benefit. The result is lower payroll tax obligations for the employer and higher take-home pay for the employee.
To learn more about this structure, check out The Champ Plan’s tax savings benefits.
Why The Champ Plan Is a Game-Changer for Employers
The Champ Plan is designed to help employers unlock real, measurable employer tax benefits without disrupting their current healthcare offering.
Key Benefits Include:
FICA savings on every participating employee
No need to alter your major medical insurance
Boosted employee morale with increased take-home pay
Turnkey administration that handles compliance and implementation
Step-by-Step: How Employers Save with The Champ Plan
Here’s a simplified breakdown of how the payroll tax savings are achieved:
Enroll Employees in The Champ Plan
Employees are offered access to a pre-tax MEC plan and post-tax wellness benefits.Reduce Taxable Wages
A portion of the employee’s gross wages is redirected pre-tax into the MEC portion.Lower Employer Payroll Tax Liability
Because gross taxable wages are lower, your payroll taxes (Social Security + Medicare) decrease.Calculate Your Savings
For every $1,000 of redirected wages, you save approximately $76.50 in FICA taxes.Repeat Across the Workforce
Multiply your per-employee savings across your entire eligible workforce.Keep More of Your Money
Use those savings to reinvest in talent, operations, or growth.
Real-World Example
Let’s say you employ 75 full-time W-2 staff. With The Champ Plan:
You save $573 x 75 = $42,975/year in payroll taxes.
Your employees get an average of $1,200–$1,500/year in increased net income.
You do it all without changing your current health insurance.
That’s a win-win, with fully compliant IRS support through a Section 125 plan.
(For more on FICA and payroll tax obligations, check the IRS official guide.)
Who Should Consider The Champ Plan?
The Champ Plan works especially well for:
Companies with 20+ W-2 employees
Service-based businesses with consistent payroll
Industries like healthcare, retail, logistics, hospitality, manufacturing
Employers looking for cost control without cutting benefits
Let’s Talk Savings
Why keep losing thousands in payroll taxes when there’s a compliant, proven way to reduce them?
Talk to The Policy Shop today about your potential payroll tax savings.
We’ll provide a custom analysis based on your business size and payroll structure.
FAQs About Payroll Tax Savings with The Champ Plan
How much can employers save with The Champ Plan?
Most employers save an average of $573 per employee, per year. For larger organizations, that can mean tens or hundreds of thousands in annual savings.
Are the savings immediate?
Yes. As soon as the plan is implemented and payroll is adjusted, FICA savings are realized with each paycheck cycle.
What industries benefit most?
Service-based industries like healthcare, logistics, manufacturing, hospitality, and retail see the highest returns. But any W-2 business with 20+ employees can benefit.
Final Thought
The Champ Plan is more than a cost-saving tool. It’s a smarter way to do business.
When employers and employees both benefit from the same solution, everybody wins.
📞 Ready to explore your company’s payroll tax savings potential? Let’s talk.