Growing numbers of Americans are concerned that their retirement savings, pensions or Social Security benefits will not carry them through their retirement years. As a result, federal and state initiatives aimed at helping retirees have been gaining political traction in recent years. Although there is no federal mandate requiring the implementation of retirement plans yet, some states (including Illinois) have taken that step in advance of any federal action that Congress may take.
The Illinois Secure Choice Savings Program (SCSP), which was signed into law on January 4th, 2015, goes into effect July 1st, 2017. This program requires employers with 25 or more employees and which have been in business for 2+ years to adopt their own qualified retirement plan, join the SCSP, or pay a maximum annual penalty of $500 per uncovered employee.
Although the SCSP law has been on the books for some time, its implementation has been delayed pending guidance from the federal Department of Labor (DOL) with respect to the types of plans that can be implemented without triggering larger reporting and oversight requirements on the employers. The SCSP’s initial planned program falls in line with the DOL’s final guidance, and has been cleared to enter into arrangements with partner vendors and develop the required disclosures that employers will need to provide.
FGMK will continue to inform you of developments with respect to the Illinois SCSP, so that you can evaluate it as a retirement plan offering for your business.
If you have any questions regarding this alert, please contact Mike Razny at 847.964.5339 or firstname.lastname@example.org.
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