Stretch Every Benefit Dollar: The Smarter Way to Use Section 125 and HRA Together

Most businesses are overpaying for benefits — and missing out on free tax savings.

You read that right. Every year, small businesses leave money on the table simply because no one told them the IRS actually wants them to save on payroll taxes.

Let’s fix that.

What’s the Difference?

Think of your benefits strategy like a tag-team match.

Section 125 is your tax-saving superhero.
It’s a payroll structure that lets employees pay their insurance premiums before taxes are taken out.
You save 7.65% in FICA, and they save on income tax. Win-win.

An HRA (Health Reimbursement Arrangement) is your generous sidekick.
Instead of taking money from paychecks, the employer reimburses team members tax-free for medical expenses — like premiums, prescriptions, or doctor visits.

There are flavors of HRAs (QSEHRA, ICHRA, EBHRA — alphabet soup, anyone?), but they all share one thing in common: flexibility.
You choose how much to contribute, what expenses are eligible, and who qualifies.

Pro Tip from Revolt HR

Why pick just one when you can have both?

Combine a Section 125 plan + an HRA, and you unlock the holy grail of benefit savings.

Here’s what that looks like:
✅ Section 125 makes premiums pre-tax
✅ Your HRA reimburses extra out-of-pocket costs
✅ You lower taxable payroll
✅ Employees feel supported (and brag about you to their friends)

That’s what we call benefits done right.

The Bottom Line

Section 125 = Tax savings for everyone.
HRA = Flexible, employer-funded perks.
Together = Smarter benefits, happier teams, stronger bottom line.

Revolt HR helps you design and implement both — without the jargon, headaches, or compliance nightmares.
We build benefit strategies that work as hard as you do.

📩 Ready to stop overpaying for benefits?
Let’s make your next renewal smarter, leaner, and 100% tax-efficient.

👉 Book a Free Benefits Audit: info@revolthr.com