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cafeteria plan

   Also found in: Financial, Wikipedia 0.01 sec.
cafeteria plan,
n an employee benefits plan in which employees select their medical insurance coverage and other nontaxable fringe benefits from a list of options provided by the employer.


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A cafeteria plan allows employees to reduce their gross income, thereby reducing the amount they pay in Federal, Social Security, and some state taxes.
A cafeteria plan allows employees to contribute a certain amount of their gross income to a designated account before taxes are calculated.
On April 21, 2008, Tax Executives Institute submitted comments on the proposed cafeteria plan regulations issued under section 125 of the Internal Revenue Code.
 
 
 
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