Section 125 Plan for Landscaping and Lawn Care Companies: The 2026 Employer Guide

• Landscaping and groundskeeping crew workers earned a median $39,150 per year ($18.82 per hour), and first-line landscaping supervisors earned a median $58,430 per year ($28.09 per hour), both as of the May 2025 Bureau of Labor Statistics Occupational Employment and Wage Statistics release.
• Landscape and groundskeeping positions account for nearly 40% of all H-2B visas issued nationally, the single largest occupational use of the program, and the Department of Homeland Security authorized 64,716 supplemental H-2B visas for fiscal year 2026 on top of the statutory 66,000 cap.
• Seasonal crew turnover runs 60% to 70% annually and 70% of landscaping companies report difficulty filling open positions, according to the National Association of Landscape Professionals' Green Industry Workforce Report.
• A disclosed hypothetical 300-employee multi-branch landscaping operator generates approximately $42,687 per year in employer FICA recapture at typical election levels.
• Unlike H-2A agricultural workers, who are exempt from FICA and FUTA, H-2B landscaping workers pay FICA the same as any domestic W-2 crew member.

A landscape crew leader earning $58,430 a year in Nashville, Tennessee keeps an extra $28.49 a month the day her employer turns on a Section 125 plan, for coverage she already paid for after tax. A few states away, an operations manager at a mid-size lawn care company has spent years assuming a seasonal workforce that shrinks every November and rebuilds every March makes pre-tax benefits too complicated to bother with, and that assumption is the single biggest reason the industry leaves employer FICA recapture on the table. Nashville's landscaping demand has grown alongside the city's population boom, the kind of market BrightView Holdings, the nation's largest landscape company with more than 21,000 employees, and TruGreen, with roughly 13,592 employees nationwide, both compete in. The full benefit stack every Benecor plan participant receives is in the table below.

How much does a Section 125 plan save a landscaping crew leader?

A landscaping or lawn care company's W-2 payroll typically splits into crew leaders, also called foremen, mowing and maintenance crew members, irrigation and design specialists, and office or sales staff, most paid an hourly wage with seasonal overtime during the spring and fall rush. Consider a crew leader in Nashville, Tennessee, one of the fastest-growing metro areas in the country and a market where national operators such as BrightView Holdings and TruGreen compete alongside hundreds of independent crews for the same residential and commercial contracts. This crew leader earns $58,430 per year, the May 2025 Bureau of Labor Statistics median for first-line supervisors of landscaping, lawn service, and groundskeeping workers nationally. Tennessee levies no state income tax on wages, so this employee's paycheck runs only two layers, federal income tax and FICA, simpler than a state with its own income tax layer on top.

This crew leader keeps an extra $28.49 a month for identical coverage, simply because it moves through payroll pre-tax instead of post-tax. The landscaping company recaptures $145 x 12 x 7.65% = $133.11 per year in employer FICA on this single employee, calculated only on the flat election amount regardless of how much overtime the crew leader works during a busy spring week.

"I always figured a benefits plan was something we'd get to once we stopped losing half our crew every winter. Nobody told me the FICA savings alone would cover more than a third of what we lose replacing one foreman."

Does the H-2B visa program change the Section 125 FICA math?

No. H-2B nonagricultural seasonal workers, the visa category landscaping companies rely on more than any other industry, are fully subject to FICA and FUTA the same as any domestic W-2 crew member. Landscape and groundskeeping positions account for nearly 40% of all H-2B visas issued nationally, and the Department of Homeland Security authorized 64,716 supplemental H-2B visas for fiscal year 2026 on top of the statutory 66,000 cap, split into tranches so spring-start landscaping crews and summer-start hospitality employers can both compete for slots. Every dollar an H-2B crew member elects into a Section 125 plan generates the identical 7.65% employer FICA recapture a domestic crew member's election generates, so a landscaping company running a workforce that is one-third or more H-2B labor during peak season is not losing any recapture value to visa status.

Why H-2A farmworkers and H-2B landscaping crews get different FICA treatment

The distinction matters because Benecor's own agriculture guide covers a workforce that gets the opposite FICA treatment. H-2A workers, the visa category most row-crop and livestock operations use, are exempt from both FICA and FUTA under rules specific to agricultural labor. H-2B workers, the category landscaping companies use because grounds maintenance is legally a nonagricultural service, carry no such exemption. A landscaping company budgeting its Section 125 savings around a mixed crew of domestic and H-2B workers can count on the full 7.65% recapture across the entire roster, a meaningfully different calculation than a farm operation running a largely H-2A crew. Compare the H-2A exemption in Benecor's agriculture employer guide→ for the contrast.

How does a seasonal layoff affect Section 125 enrollment?

A seasonal layoff does not disqualify a crew member from re-enrolling the following spring, and it does not require the landscaping company to keep paying for coverage during off-season months when there is no paycheck to deduct from. Treasury Regulation Section 1.125-4 lists a change in employment status as a permitted election-change event, and moving from full-time seasonal work to laid off, or from laid off back to rehired, both qualify. A landscaping company's plan document should specify that coverage and pre-tax elections pause automatically when a crew member's hours drop below the plan's eligibility threshold at the end of the season, and that a rehired crew member is reinstated to the same election, or allowed to make a new one, within the standard 30-day window most cafeteria plans provide once the new hours resume.

What happens when a laid-off crew member is rehired in the spring?

Most landscaping companies rehire a substantial share of the previous season's crew, since retraining every position each March costs more than restoring recognized foremen and equipment operators to their old routes. IRC Section 125 rules require an employer using the new-hire retroactive pre-tax payment provision to reinstate a rehired employee to the elections held before layoff, so a crew leader who elected $145 per month in October and returns in March keeps that same election active without a fresh 30-day waiting period, unless the plan document specifies otherwise.

What landscaping crews actually get

A crew member finishing a 95-degree August route, or a foreman managing three trucks and an irrigation callback list, rarely has post-tax budget left over for a routine doctor's visit, and losing a weekday to an appointment means either burning limited PTO or falling behind on a route sheet. Crew leaders, mowing crews, irrigation specialists, and office staff who join a Benecor plan get real care without needing to take a day off route to use it. Review how the same benefit stack works across every industry on the Section 125 hub→.

• $0 Virtual Urgent Care, 24/7: A crew member who twists an ankle on a Saturday route reaches a licensed clinician without waiting for Monday.
• $0 Virtual Primary Care: Routine visits and prescription renewals without losing a route day or a foreman's afternoon.
• $0 Mental Health Counseling: Outdoor crew work is physically demanding and seasonal income swings add real financial stress, and zero-cost virtual counseling is one of the highest-used benefits at the landscaping companies Benecor works with.
• 800+ commonly prescribed medications at $0, fully covered: Maintenance medications with no out-of-pocket cost from the first payroll cycle, useful for a workforce that tends to skip care during the busy season.
• Procedures at 57% savings, specialist visits at 35% off, lab tests at 60% off, imaging at 75% off: When a crew member needs in-person care after an on-the-job strain or sprain, the network discounts mean the visit actually happens.
• Dental, vision, and family coverage with 350,000+ doctors nationwide: Coverage that stays active and portable for a rehired crew member returning each spring.

Section 125 for landscaping companies from 15 to 300+ employees

Single-crew and small residential landscaping companies

A typical 15-employee single-crew landscaping company, an owner-operator, two foremen, ten crew members, and an office administrator, at an average election of $130 per month generates approximately $1,790 per year in employer FICA recapture. An owner who runs the business as a sole proprietorship or a single-member LLC is not a W-2 employee and does not participate in the plan personally, but every crew member and office staffer on payroll is eligible regardless of the owner's own structure. Review the full §125 implementation and compliance flow→ for any employer size.

Multi-crew regional lawn care and landscape maintenance companies

A 75-employee multi-crew regional company, running several maintenance and design crews out of one or two yards with a mix of full-time, seasonal, and H-2B labor, generates approximately $9,983 per year in employer FICA recapture at an average $145 monthly election. At this size, eligibility rules need to apply consistently whether a crew member is domestic or H-2B, since both generate the identical recapture.

Franchise networks and multi-branch operators

A disclosed hypothetical 300-employee multi-branch landscaping operator, the scale at which a regional company running several yards or a corporate-owned franchise territory competes, generates approximately $42,687 per year in employer FICA recapture at an average $155 monthly election. This figure is a disclosed hypothetical scenario, not a claim about any named company's actual headcount or plan design. Lawn Doctor, the largest lawn care franchise system with roughly 630 franchised locations, and U.S. Lawns, the leading commercial landscaping franchise with more than 200 locations, illustrate how the industry scales through independently owned territories rather than centrally employed crews, though neither figure is the basis for the recapture estimate above. Each franchise location is typically its own separate common-law employer, so a Lawn Doctor or U.S. Lawns franchisee sponsors its own Section 125 plan rather than joining one run by the parent brand.

Does Section 125 help with the landscaping industry's seasonal turnover?

A Section 125 plan does not change base pay, but it can help retention economics in an industry where seasonal crew turnover runs 60% to 70% annually and 70% of landscaping companies report difficulty filling open positions, according to the National Association of Landscape Professionals' Green Industry Workforce Report. Replacing a crew member means recruiting, a new hire's ramp-up time on equipment and routes, and the productivity gap while a route runs short-handed, costs that stack up fast against an industry already competing for the same limited labor pool every March. A benefit that shows up in take-home pay from the first paycheck, enrolled in minutes on a crew member's own phone before the spring rush starts, is one more reason a crew member returns to the same company instead of taking a competing offer down the street. Construction crews face a similar seasonal and outdoor-labor retention challenge→, though with a different prevailing-wage compliance layer.

Compliance for landscaping and lawn care companies

Nondiscrimination testing with a seasonal headcount

Section 125 nondiscrimination testing runs the same three annual checks every plan requires: the Eligibility Test, the Benefits and Contributions Test, and the Key Employee Concentration Test, which caps benefits flowing to owners and officers, generally those earning above $160,000 in 2026 or owning more than 5% of the company, at 25% of total plan benefits. A landscaping company's headcount swings sharply between March and November, so the testing snapshot date matters more here than in a year-round vertical, and the plan document should specify whether testing runs at peak season, off-season, or an averaged measurement period to avoid a technical failure caused only by the seasonal roster shrinking.

The ACA seasonal worker exception

The ACA's 50-full-time-equivalent-employee threshold for applicable large employer status includes a specific seasonal worker exception under 26 CFR Section 54.4980H-1(a)(38). An employer whose workforce exceeds 50 full-time-equivalent employees for 120 days or fewer during the calendar year, where the employees above the 50-employee line during that window are seasonal workers, is generally not an applicable large employer. A landscaping company that swells from 20 year-round employees to 90 during a 100-day spring rush can often rely on this exception, though the determination is specific to each company's actual staffing pattern and should be confirmed with ERISA counsel.

Launching §125 for a landscaping company: 5 weeks

1. Week 1: Benecor confirms the company's entity structure, identifies which crew members are W-2 eligible including H-2B seasonal workers, and flags any 1099 misclassification risk. The owner selects a benefit menu and receives a signed savings projection.
2. Week 2: ERISA counsel drafts the plan adoption agreement and summary plan description with seasonal layoff and rehire election rules built in under Treasury Regulation Section 1.125-4.
3. Week 3: Fast, QR-code enrollment staff complete on their own phone, timed to reach returning and new crew members before the spring ramp-up begins.
4. Week 4: Election data transmitted to the company's payroll platform, whether that's Gusto, ADP, Paychex, or a landscaping-specific system like Aspire or Service Autopilot. Deduction codes configured as pre-tax for federal income tax and FICA, applied identically to hourly, seasonal, and piece-rate pay.
5. Week 5: First pre-tax payroll runs across the full crew as the season opens.