Are you making the most of your workplace benefits? Many employees overlook valuable perks.
The following is inspired by a recent article in the WSJ, who concluded that 2 out of 5 employees do not use (or under-utilize) their benefits. As accountants, we have noticed this to be true.
401(k) Match 🤝
- Maximize your 401(k) contributions to benefit from employer matches.
- Contributions reduce taxable income and provide long-term savings opportunities. This is your single biggest deduction against W2 income & we routinely see it underused. Do not wait too long to year-end – it will take your HR or benefits team a few weeks to make changes. You should act on this now.
- For 2023, the contribution limit is $22,500 (or $30,000 if you’re 50 or older).
Medical Spending Accounts 🩺
- Utilize tax-advantaged accounts like Flexible Spending Accounts (FSA) and Health Savings Accounts (HSA).
- FSAs allow you to reduce taxable income by contributing pre-tax dollars, with a 2023 limit of $3,050.
- HSAs offer tax-free savings for qualified medical expenses and allow unused funds to roll over to future years.
- Max HSA contributions for 2024 are $4,150 for individuals and $8,300 for families.
Student Loan and Tuition Benefits 🎓
- Explore education-related benefits like tuition reimbursement or prepaid tuition.
- Some employers assist with student loan payments, but amounts above $5,250 are taxable. However, the first $5,250 are tax deductible, depending on your income level.
Supplemental Insurance 💼
- Consider supplemental insurance policies offered at group rates during open enrollment.
- Coverage options may include life, disability, long-term care, critical illness, and pet insurance.
- Research outside options to ensure employer offerings are favorable.
Wellness Programs and Incentives 🏃
- Participate in employer wellness programs, which often include fitness, nutrition, and health screenings.
- Earn rewards such as cash incentives or insurance premium reductions for wellness activities.
Employee Assistance Programs (EAP) 🛋️
- EAPs offer confidential support for personal issues like addiction, stress, and family concerns.
- Employees can access services like counseling, referrals, and advisory resources.
- Some employers provide free or low-cost advisory services for financial planning.
Backup Care ✉️
- Explore subsidies and reimbursements for childcare, eldercare, and pet care through backup care programs.
- These programs offer vetted caregivers at affordable copay rates.
- Address care needs to reduce absenteeism and stress.
Other Perks 🎟️
- Discover discount programs for various products and services offered by employers.
- Look for employee discounts on retail, dining, entertainment, and travel.
- Keep an eye on employer communications to stay informed about available benefits.
Don’t miss out on valuable workplace benefits—take the time to review and optimize your choices. For personalized guidance, reach out to your HR department or feel free to approach us with questions.
Please be sure to address this as soon as possible since there is limited time to make changes with most employers (and some may require several weeks of implementation if you are to use the benefit for 2023).
Looking forward to hearing from you should you have any questions!
—
George Dimov CPA
www.dimovtax.com
(833) 829-1120 toll free
