No one, not even your accountant, looks at all government regulations and changes in tax laws and thinks, “What fun!”
As a business owner subject to the constant pulls of employees, customers and now regulatory bodies (which may sometimes pull in opposite directions!) you are probably no stranger to the same phenomenon.
The Bad News
Passing of the Secure Act of 2019 kicked off a flurry of states passing new regulations that require many employers to provide a retirement plan. What’s more, few states have the same employee count threshold for requiring a plan.
Now with the newly passed Secure Act 2.0, there are even more regulations around retirement plans.
If your business has operations, or employs workers, in multiple states you may be subject to a minefield when figuring out what applies to you.
And it doesn’t stop there – while the dust has settled for now, regulations that are pending and in discussion could further change how retirement works for Americans.
Do you know how state regulations will impact the requirements faced in your own state, or the various states in which you operate?
The Good News
But before you shake your fist in the air at this latest tribulation, let us give you the good news: Companies with proper plan design can actually lower overall payroll costs and even boost employee morale to boot. How? The federal Secure Act 2.0 created many incentives to go along with the requirements posed by the state laws.
These incentives include tax credits and deductions for the employer that may offset some or most of the costs of providing such plans, as well as incentives for the employee themselves.
With the right plan, you can turn those regulations from a headache into a huge win for you business and
your employees.
How to Design a Great Retirement Plan
But how do you get the right plan? One that turns a minefield into a diamond field.
There are lots of moving parts in a retirement plan, and one bad piece can create a large problem.
You need the right mix of the following components to have the best outcomes:
- Be clear on your objectives for the plan, and design it to meet your needs.
- Pay attention to all the costs, demand full disclosure and transparency.
- Build your plan to maximize the benefits to both your team and your business.
- Excellent communication and education for participants and those administering the plan internally.
- Take advantage of the tax credit and tax deduction incentives.
- Be mindful of the fees imposed to the employee, as well as investment options, and performance of each of those available investments.
- Make sure your administrator is watching out for the most common mistakes that may trigger an audit.
In short, to get the right plan you need to hire the right people. Work with and hire experienced and knowledgeable retirement plan providers who are fiduciaries.
At Confidence Wealth Management we work with employers, trustees, and human resources on employer-
sponsored plans.
We specialize in designing custom-made plans and implementing retirement plan services that move you toward your goals and the best results for the company, the plan, and the participants.
We create winning strategies and solutions for our clients. Click below to set up a no cost, no obligation consultation or contact us for more information.
