In the past, companies have been allowed to limit access to their 401(k) plan to just full-time employees but that is about to change starting in 2024. With the passing of the Secure Act, beginning in 2024, companies that sponsor 401(K) plans will be required to allow part-time employees to participate in their qualified retirement plans.
It’s very important for companies to make note of this now because many companies will need to start going through their employee census data to identify the part-time employees that will become eligible for the 401(K) plan on January 1, 2024. Failure to properly notify these part-time employees of their eligibility to participate in the plan could result in plan compliance failures, DOL penalties, and it could require the company to make a mandatory employer contribution to those part-time employees for the missed deferral opportunity.
Contact Michael Ruger with Questions: 518-477-6686 or mruger@greenbushfinancial.com
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19 сен 2023
