Assignment 2: Section 125 Of The IRS Code

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i. Section 125 of the IRS code is important because it allows for flexible benefit plans. Before this section was made they had many negative tax consequences for the flexible benefit plans. A flexible benefit plan is when the employees are allowed to choose between two or more benefits that are either qualified benefits and/or cash. This allows people to mix and match their health insurance to obtain the best type of care they need and want, so they are able to go to the hospitals, physicians, and specialists as needed.

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