…gain access to a new layer of prospective retirement plan clients. How Does a Pooled Employer Plan Work? Simply put, a PEP allows multiple employers to adopt a retirement plan that covers their employees under one overall plan. Rather than each employer establishing a separate…
…address many common concerns One way that federal law enables employers to avoid missteps is through the use of multiple employer plans, or MEPs. Simply put, MEPs allow unrelated employers to combine their plans under a single MEP “sponsor.” Typically, the sponsor will make this…
…of Form 8881, Credit for Small Employer Pension Plan Startup Costs and Auto-Enrollment to claim the credits. What about businesses that will join or have joined multiple employer plans (MEPs) or Pooled Employer Plans (PEPs)? Fortunately, Section 111 of SECURE 2.0 ensures the startup tax…
…some of the key differences between three different defined contribution plan types, which may help you start the process. The chart explores three broad plan design options: single employer plans, closed multiple employer plans (MEPs), and pooled employer plans (PEPs). Single employer plans, as the…
…guidance: Sponsors may but are not required to include in their plan any type of Roth contribution – employee elective, employer matching, or employer nonelective. The rules currently (pre-SECURE 2.0) applicable to employee elective Roth contributions also generally apply to the new Roth employer contributions….
…the 3-year credit related to small employer startup costs for employers with no more than 50 employees from 50% to 100% of startup costs. New employer contributions credit: A new 5-year credit for matching and nonelective contributions (to qualified plans other than defined benefit (DB)…
…Deduction limit – the deductible employer contribution cannot exceed 25 percent of total eligible participant compensation. Annual additions limit – for 2023, the total combined limit for employee and employer contributions is $66,000 (or $73,500 for those eligible for catch-up contributions). These are just some…
…greatest standard of care—or risk personal liability if they fall short. Employers Are Fiduciaries By default, employers (plan sponsors) are fiduciaries of the retirement plans that they maintain. First, Section 3(16) of the Employee Retirement Income Security Act of 1974 (ERISA) defines “plan administrator” as…
…a participant upon retirement. In other words, the plan sponsor (employer) is allowed to fund a DB plan with larger annual contributions than would be allowed under a DC plan—as long as all the contributions and earnings don’t result in benefits for participants that exceed…
…credit for small employers SECURE 2.0 provides a new small employer (100 employees or less) tax credit for defined contribution (DC) plans that provide that military spouses are, within two months of hire, immediately eligible for and fully vested in employer non-elective and matching contributions…
…plan to offer employer contributions to LTPT employees. Plan sponsors that employ part-time workers should make certain to track their hours carefully and to allow eligible employees to defer in 2025 and beyond. Some employers are also considering their plan provisions and plan design to…
…maintained by the employer Must file a Form 5500 annually Voluntary employee deferrals Mandatory employer contributions (generally, 3% match or 2% nonelective) Immediate vesting for contribution types Additional information at IRS SIMPLE 401k facts Safe Harbor 401(k) No limit on number of employees Voluntary employee…