For many people this time of the year is spent coordinating Thanksgiving cooking with family members, and laying out a plan of attack for their Black Friday shopping. But for plan sponsors of qualified retirement plans some time should be spent on ensuring any, and all annual notices are distributed to plan participants.
Qualified retirement plans with a December 31st
plan year end may need to issue one or more annual notices to plan participants
by December 1st. Failure to issue a required annual notice can put
the plan’s qualified status in jeopardy. Below you will find the most common
notices applicable to defined contribution plans:
-
401(k)
Safe Harbor Notice: All
eligible participants in a safe harbor 401(k) plan must receive an annual
notice that describes the safe harbor matching contribution formula or safe
harbor non-elective contribution formula.
-
401(k)
Automatic Enrollment Notice: If the plan provides that employees will be automatically
enrolled, the plan sponsor must give eligible participants an annual notice
that describes the circumstances in which eligible employees are automatically
enrolled and the level of pay that will be automatically contributed to the
plan.
-
Qualified
Default Investment Alternative Notice (QDIA): A defined contribution plan that permits participants
to direct the investment of their account balances may provide that if a
participant does not give an affirmative investment direction, the portion of
the account balance that is not given direction will be invested in a qualified
default investment.
Alliance Benefit Group North Central States, Inc.
understands that this may seem like a daunting task for plan sponsors. Because
of this, led by our Compliance Team, ABGNCS packages all required notices with delivery
instructions in the “year end packet”. In addition, ABGNCS assigns a dedicated
administration team to each plan in order to assist plan sponsors with
administration questions.
To learn more about Alliance Benefit Group North
Central States, Inc. and the services we provide please visit www.abgncs.com or email info@abg-mn.com.
Happy Holidays!
The Author: Seth Holstad
Account Executive
