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K Why are cafeteria plans helpful in the design of an employee benefit plan that provides nontaxable fringe benefits? OFFER O A. Since employers must provide benefits on a nondiscriminatory basis, it is difficult to offer benefits only to interested employees and at the same time meet the nondiscrimination requirement. This can lead to employers providing benefits that are of little benefit to certain employees. Under a cafeteria plan, employees may select which benefits they wish to receive, and select the items that they feel are most beneficial. For example, single employees are often not interested in life insurance coverage. OB. Since employers are not required to provide benefits on a nondiscriminatory basis, it is easier to offer benefits only to interested employees. Under a cafeteria plan, employees may select which benefits they wish to receive throughout the year. For example, they are not restricted to yearly elections, but can select the benefits on an as-needed basis. O C. Under a cafeteria plan, employees are afforded greater benefits through their employers because the employer can limit these benefits to single employees only, or employees who are the only worker in the household. For example, a household that has two spouses where both work, the employer does not need to offer employee benefit plans to them. O D. Under a cafeteria plan, employees can select to receive cash in lieu of available benefits equaling up to two-thirds of the amount they would receive if they selected to take the benefits. For example, employees who do not require the nontaxable fringe benefits, and elect to receive cash, do not have to include this amount into gross income.

Why are cafeieria plans heipful in the design of an employee beneft plan thes provides nontamable fringe benefts

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