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Posted by Fred Holt, Alfred, December 6, 2007: Could anyone provide some guidance on how the Town would go about switching our health insurance premiums that our individual employees are paying (through MEMHT) to a pre-taxable deduction.

Responses: The Town of Wiscasset uses a POP (Premium Only Plan) through Ceridian.  That is the parent company or at least has some connection to Colonial Accident.  Using their plan allows our health and dental premiums to be tax free.  It results in a small raise in real terms for your employees. (Jim George, Wiscasset)

The Town of Dover-Foxcroft belongs to a Cafeteria Plan and our premiums to MMA Health Trust are pre-tax. (Barbara Moore, Dover-Foxcroft)

The Town of Winthrop has a cafeteria 125 plan (with the IRS) which I believe is the first step to setting up pre-tax premium deductions.  It was originally set up for us through Colonial Insurance (in exchange for offering  their insurance products to our employees).  This plan provided for pre-tax premiums on a number of insurance products (including health and dental premiums paid by employees through p/r deductions) as well as pre-tax health care and dependent care reimbursements accounts.  For many years we used it only for the pre-taxed medical and dental premiums P/R deductions.  Recently our employees expressed an interest in medical/ health care reimbursement accounts in addition to pre-taxing insurance premiums so we have hired Benefit Strategies , Manchester , NH to administer our program.     (Jan Tewksbury, Winthrop)

2007 Is the first year Harpswell has offered the pre-tax health insurance.  The Town hired Nancy Cullins of HR Support & Consulting Services, Inc. (655-5396) for $350 to prepare the cafeteria plan – Selectmen approved the plan  and off we went.  Hope this helps. (Terri Sawyer, Harpswell)

We just are about to do just that starting January 1, 2008.  What you have to do is start up a section 125 Flex Plan, approved through the IRS.  We are going through HR Support & Consulting Group, and they are basically doing all the work for us.  If you want any more information, please feel free to contact me. (Teri Dane, Ellsworth)