Simulating Benefit Elections

Note: You do not need to create a flex dollar record for the employee before you use this simulation.

You can simulate the cost of various benefit elections. Use different combinations of pretax and after-tax dollars and see the effect of benefits on an employee's federal taxable wages. For flex plans, the application spends flex credits before spending employee pre-tax dollars.

To simulate benefit election

Access Election Simulation (BN65.1).

Note: For security purposes, the employee's gross pay does not default. Use drill around to view the employee's gross pay if your security access allows.
Select the company, employee, and type the As of Date and Gross Pay.
Select the Inquire form function. The form displays all benefit plans for which the employee is eligible.

Note: From the FC field next to the plan name, use the drill around feature to view the plan's options.
Enter the benefit elections desired. For each plan, enter a value in the appropriate column. Use the following guidelines:

Cov Opt (Coverage Option)

If the plan has coverage options, type the coverage option the employee wants.

Note: A plan has coverage options if the Contribution Type field is Coverage Options for the plan in Benefit Plan (BN15.1).

Multiple

If the plan's coverage is a multiple of salary, type the multiple of salary the employee wants to elect.

Amount

For plans offering coverage as an amount, type an amount of coverage.

For defined contribution plans, type the total annual contribution as a flat dollar amount, including the pretax and after-tax. Do not enter the contribution as a percent. If the plan only allows percent contributions, you are not able to simulate the election using this form. For vacation plans, type the number of hours to be bought or sold. For spending accounts, savings bonds, and stock purchase plans, type the annual contribution amount.

PreTax

Type the amount the employee wants to spend on a pretax basis for this benefit, including flex credits and pretax dollars. If the benefit gives the employee flex credits, type a negative amount.

If you enter a value in the Cov Opt, Multiple, or Amount field, leave this field blank. The application defaults the pre-tax amount when you add the record, unless the plan allows both pre and after tax contributions and no default tax type is defined for the plan.

AfterTax

Type the amount the employee wants to spend on an after-tax basis for this benefit.

If you enter a value in the Cov Opt, Mult, or Amount field, leave this field blank. The application defaults the after-tax amount when you add the record, unless the plan allows both pre and after tax contributions and no default tax type is defined for the plan.
Select the Add form function.

Options for Simulating Benefit Elections

The following options are available from Election Simulation (BN65.1).

After you specify the employee's contributions, click the Totals button to access the Flex Credits (BN65.2) subform. Use this subform to see the total flex and pretax dollars the employee can use to purchase benefits and the overall effect on federal taxable income for the simulated elections.