What Payroll Tax Mistakes Are Costing Your Business Thousands?

Payroll taxes are one of the largest recurring expenses for any business with W-2 employees. Yet most employers unknowingly overpay year after year, simply because they aren’t aware of the options available to legally and strategically reduce payroll taxes. These overpayments can quietly drain tens or even hundreds of thousands of dollars from your bottom line—money that could be reinvested into your business or your people.

At Health Sphere, we help employers stop this tax waste in its tracks through Core360—one of the most compliant and benefit-rich programs available. Core360 is not just a traditional Section 125 plan. It’s a fully integrated employee benefit solution that leverages Section 125 together with a Preventative Care Management Plan (PCMP) and a Self Insured Medical Reimbursement Plan (SIMRP). This combination creates a win-win for employers and employees, providing real value without disruption.

Let’s break down the most common payroll tax mistakes and how Core360 can help you avoid them while delivering better benefits, more take-home pay, and real savings.

Mistake #1: Failing to Leverage Section 125 Plans Correctly

Many businesses have a basic cafeteria plan that allows employees to pay for health plan premiums with pre-tax dollars. While that’s a good start, it’s just scratching the surface.

Most traditional Section 125 plans don’t go far enough—and they certainly don’t offer the layered tax advantages of Core360. With Core360, employers can reduce payroll taxes by an average of $600 per W-2 employee per year. That’s $60,000 in annual savings for every 100 employees.

Core360 takes the tax-saving power of Section 125 and combines it with a fully managed PCMP and SIMRP, delivering:

Reduced payroll tax liability (FICA, FUTA, SUTA)

No disruption to existing benefits

A fast, automated rollout in just 30–45 days

This isn’t theory—it’s happening now. More than 40,000 employees are already enrolled in Core360, experiencing the difference firsthand.

Real Employer Savings: $600/year per W-2
No out-of-pocket cost
Reduced claims ($1,400 saved over 3 years)
No change to current plans
Fast, compliant implementation

If you’re looking to reduce payroll taxes without risking compliance or disrupting your existing benefits, Core360 is the smartest next step.

Mistake #2: Overlooking Employee Take-Home Pay Impact

Many cost-saving strategies reduce expenses by cutting benefits or shifting costs to employees. That’s not the case with Core360.

In fact, Core360 actually boosts take-home pay for employees—typically by 3–4%, or about $100 per month. And they don’t lose a dime in existing benefits. Instead, they gain access to an upgraded, preventive health support system that enhances well-being and reduces stress.

Here’s what your team gets through Core360:

$0 copay Telehealth for physical, mental, and behavioral health

Access to the Mayo Clinic’s world-class wellness tools and health dashboard

Universal Life, Disability, and Critical Illness coverage

Support for spouses and dependents

Preventative care that reduces long-term health risks

Employees see a pay bump and a benefit upgrade, without any trade-offs.

If you’re struggling with retention, engagement, or rising healthcare claims, this kind of benefit package sends a clear message: “We care about your health and your wallet.”

Mistake #3: Delaying Action Due to Compliance Concerns

We hear it often: “This sounds great, but is it compliant?”

Yes. Core360 is 100% IRS-compliant and legally sound. It’s not a workaround or a tax loophole—it’s a fully vetted, audit-protected system that integrates three IRS-approved structures (Section 125, PCMP, SIMRP) into one easy-to-manage plan.

That’s a big reason why employers trust Health Sphere and Core360. We manage the program from start to finish, including:

Full plan administration and onboarding

Secure enrollment portals for employees

Legal documentation and audit support

Ongoing compliance monitoring

There’s no guesswork, and your HR team doesn’t need to become tax experts overnight. We make the rollout seamless and support your team every step of the way.

Fully managed setup in 30–45 days
Transparent reporting and documentation
Built-in compliance and audit protection

Our tax consulting services help simplify complexity, so you can focus on your business, not the fine print.

Mistake #4: Assuming There’s a Catch

One of the most common reactions we hear is: “This sounds too good to be true.”

We get it—most cost-saving programs come with hidden fees or require you to change everything. Core360 is different.

There’s no cost to the employer. No disruption to existing health plans. And no change in employee take-home pay (unless it’s going up).

Our model is designed to align with your success. We only get paid if you save money. That’s how confident we are in Core360’s results.

No upfront fees
No plan changes required
No risk—only upside

You don’t have to overhaul your systems or fire your current broker. Core360 works with what you already have—and improves it.

Mistake #5: Not Partnering with Experts in Tax Services Consulting

Trying to implement these kinds of strategies without expert guidance can lead to missed savings, compliance issues, or employee confusion.

That’s why companies turn to Health Sphere for our tax services consulting and implementation expertise. Our advisors specialize in layered tax strategies that reduce payroll taxes while improving employee outcomes.

We don’t just advise—we deliver, implement, monitor, and support every part of the process. That’s why we’re one of the fastest-growing solutions in this space, with a mission to reach 250,000 lives impacted.

Trusted by thousands of employers
Designed to scale across industries and team sizes
Backed by real savings, real compliance, and real results

We’re not just a tax consulting service—we’re a strategic partner in helping you retain talent, reduce waste, and offer benefits that actually benefit.

Ready to Stop Overpaying on Payroll Taxes?

The mistakes above are costing businesses like yours thousands each year—sometimes without realizing it. With Core360 from Health Sphere, you can flip the script and transform a hidden expense into a powerful savings engine.

Here’s what you get: