Human Resources |
Article by Gary Mauger, New Pinnacle Consulting Group, and Evan Giller, Boutwell Fay, LLP
The SECURE (Setting Every Community Up for Retirement Enhancement) Act and its enhancements to retirement plans are regarded as the most comprehensive since the Pension Protection Act of 2006. The Act, which became law December 20, 2019, includes 30 provisions designed to expand and preserve retirement savings and provide administrative improvements. Some provisions in the law were effective in 2020, others have future implementation dates, and some were effective retrospectively.
Among the many provisions that make it easier for small employers to offer a retirement plan, the Act:
Considering whether to offer a retirement plan to employees is an important decision. Smaller organizations banding together in a MEP to share the cost could be an opportunity for all schools. Employers, however, need to look carefully at the costs and benefits of a MEP before agreeing to join.
For schools currently offering a 403(b) or 401(k) retirement plan, there are mandatory and optional changes to your plan.
In addition to the SECURE ACT, several laws have been enacted since 2018 that also impact 403(b) and 401(k) retirement plans. These include the Bipartisan Budget Act 2018, the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020 and Consolidated Appropriations Act (CAA) of 2021.
These legislative acts contain required and optional changes affecting plans. As the plan sponsor, you are responsible for the plan’s compliance. As the IRS finalizes the rules and provides amendment deadlines, plan sponsors need to ensure the amendments are adopted in a timely manner. For schools using a plan document provider’s Volume Submitter Document, the document amendments will be drafted and released to plan sponsors when available.
The Best Laid Plans: Retirement Investments and Fees (Jan/Feb 2020)
CARES ACT and Retirement Plans (May 2020)
The Assured Self-Insured (Jan/Feb 2021)
Sign in to leave a comment
Get Net Assets NOW
NBOA's free twice-monthly newsletter
1400 I Street, NW, Suite 675Washington, DC 20005www.nboa.org