What actually drives the cost
Two things determine what Section 125 testing should cost: how many tests your plan requires, and whether you're testing once at year-end or adding a mid-year projection. Everything else, company size, industry, number of employees, has less impact on price than most employers assume, since the tests themselves scale with your data, not with how many people you employ.
Plan type is the bigger factor. As covered in our POP vs. FSA vs. DCAP comparison, a Premium Only Plan requires three tests, adding a Health FSA brings it to five, and adding a Dependent Care FSA on top of that brings it to nine. More required tests means more work, which is reflected in price.
What we charge
Flat fee, based on plan type and timing, no quote request needed:
| Plan Type | Year-End Only | Mid-Year + Year-End |
|---|---|---|
| POP only | $250 | $400 (save $100 vs. two runs) |
| POP + Health FSA | $400 | $650 (save $150 vs. two runs) |
| POP + FSA + DCAP | $500 | $800 (save $200 vs. two runs) |
Every tier includes all applicable tests, a full results report, and corrective guidance if anything fails, at no extra cost. See the exact recommendation for your situation on our pricing and process page.
Free retest included: if you test mid-year and a projection shows a problem, we retest at no additional charge once you've made adjustments, so you can confirm the fix worked before the plan year closes.
Why mid-year testing costs more but can save you more
A mid-year engagement costs more than a year-end-only test because it's genuinely two testing runs instead of one, a projection partway through the year and a confirmation run at year-end. The bundled price is discounted versus paying for each separately, but it will always cost more than doing year-end only.
What that extra cost buys is time. A year-end-only test that reveals a failure gives you an accurate result and nothing to do about it for that plan year, since the window to fix anything has already closed. A mid-year projection that reveals the same problem gives you months to actually correct it. For a plan with any real chance of failing, particularly closely-held businesses or companies with a concentrated ownership group, that difference is usually worth more than the extra fee. See our guide on testing deadlines and timing for how to think about when mid-year testing makes sense for your plan.
What drives cost industry-wide
Outside of our own pricing, testing services in this space generally fall into two categories: flat-fee providers who price by plan complexity the way we do, and quote-based providers who require a consultation before disclosing a price, which usually reflects a more variable, hourly, or negotiated cost structure. Free, self-service testing portals also exist, but "free" there typically means the cost moves from a fee to your own time and risk rather than disappearing. Our comparison of DIY portals vs. a managed service covers that tradeoff directly.
FAQ
What's the cheapest way to get Section 125 testing done?
A year-end-only test for a Premium Only Plan is the least expensive option, since it requires the fewest tests and a single testing run. Adding a Health FSA or Dependent Care FSA, or adding a mid-year projection alongside the year-end run, increases cost because it increases the actual work involved.
Is mid-year testing worth the extra cost?
If there's a real chance your plan could fail, yes. Mid-year testing costs more upfront but is bundled at a discount versus paying for two separate runs, and it's the only way to find a problem while there's still time to fix it before the plan year closes. A year-end-only test that reveals a failure gives you documentation, not a fix.
Are there hidden costs beyond the flat testing fee?
Not with a flat-fee model. Our pricing covers the full engagement, running every applicable test and delivering results with corrective guidance if anything fails. A free retest is included if you test early enough to act on the results. The only cost beyond the flat fee would be your own internal time gathering the census data.
Why do some testing tools advertise as free?
Free self-service portals typically shift the cost from a fee to your own time and risk, you do the data entry and classification work yourself, with no review of unusual situations like S-corp ownership or family attribution, and no corrective guidance if something fails. See our comparison of DIY portals versus a managed service for the specifics.