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Pre-Tax Insurance Premium Plan (PIPP)

PIPP is a Pre-Tax Insurance Premium Plan (PIPP).  This plan deducts your medical, dental and vision premiums from your pay BEFORE TAXES are calculated and deducted.  Reducing your taxable income INCREASES NET TAKE HOME PAY!

All APS employee enrolled in a medical, dental or vision plan.  New employee become eligible when their medical, dental, or vision plans become effective.  All employees are automatically enrolled in PIPP.  However, you can disenroll by checking   “NO” on the enrollment form under the heading PIPP.

Normally, insurance premiums are deducted after FICA and federal taxes are deducted.  This means premiums are paid with “after tax dollars”.  With this plan the premiums are deducted from you salary before FICA and federal taxes are calculated.  This reduces your taxable income by the amount of your premium(s).  At the end of the year, your medical, dental and/or vision premiums will not be included in your reportable W-2 income (but will show in another box on your W-2), and will not be subject to federal or state income taxes.  PIPP is regulated by Section 125 of the Internal Revenue Service Code.  If you waive PIPP now you can enroll later during our annual Switch/Open enrollment period held each October.

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