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Compliance November 14, 2016
Guide Discusses Setting Up and Operating Automatic Enrollment 401k
The IRS document can be used by advisers in helping them educate plan sponsors about automatic enrollment 401(k) plans as well as to help plan sponsors set up such plans.
Reported by Rebecca Moore
The Internal Revenue Service has published a document, “Automatic Enrollment 401(k) Plans for Small Businesses.”
The booklet discusses why a small business would want to adopt an automatic enrollment 401(k) plan as well as how to establish one.
It also explains details of operating an automatic enrollment 401(k) plan as well as plan sponsors’ fiduciary responsibilities. It includes discussions about hiring and monitoring service providers and about required disclosures to participants.
The booklet includes an automatic enrollment 401(k) plan checklist.
The document can be used by sponsors of automatic enrollment 401(k) plans to educate themselves about how to operate the plan and stay in compliance with laws and regulations. It can also be used by advisers in helping them educate plan sponsors about such plans as well as to help plan sponsors set up an automatic enrollment 401(k) plan.