PrimePay has a good article about Non-Discrimination Testing (NDT) basics: https://primepay.com/blog/nondiscrimination-testing-basics
The article explains that certain benefits receive tax favored treatment under §125 of the tax code. Cafeteria Plans, which may include pre-tax premium payments, health flexible spending accounts (health FSAs), health reimbursement arrangements (HRAs), and dependent care accounts (DCAs), allow employees to use pre-tax dollars to pay for qualified expenses.
