The SECURE Act, which stands for “Setting Every Community Up for Retirement Enhancement” Act, was signed into law at the end of 2019. The Act takes small but impactful steps towards addressing the country’s retirement crisis by incentivizing small business owners to sponsor retirement plans for their employees.

Our four-part series will cover four significant upgrades made by the Act that you should consider.

Significant Upgrade #1:  Widened access for employers

Historically, the cost, administration, and liability of running a sponsored retirement plan had been difficult for smaller companies to manage. Multiple-Employer Plans (MEPs) are appealing because they can reduce this burden, but many businesses had not been able to join due to the “common interest” requirement.

Starting in 2021, this prerequisite will be removed and unrelated companies will be permitted to band together and run MEPs through a pooled plan administrator. The Act also overturns the “One Bad Apple” rule. Previously, this rule dictated that a violation by one MEP participant meant that the entire pool was disqualified, which made employers uneasy about joining an MEP. As a further boost, small business owners will see a substantial hike from the previous $500 tax credit offered to defray retirement package start-up costs. This has been increased to $5000 a year for the next three tax years.

We Are Here to Help
You have worked hard to build a prosperous business for you and your employees. We are here to help develop a plan to ensure that your business thrives and takes advantage of the new aspects of the SECURE Act. At Marvel Law, we are here to help serve you with purpose.  Click here to email us or call us at 309-807-2885 for your FREE 15-minute consultation.