Updates to the Illinois Secure Choice: Retirement Savings Program Calls for ComplianceShare this post
Illinois Updates Retirement Savings Program
Chances are If you’re a small business owner in Illinois, you may have recently received a letter from the State Treasurer’s Office or heard about Illinois Secure Choice in the news. Established in 2015, the program has made some changes which have gone into effect recently. Most importantly, the program now applies to employers with five or more employees. This is a change from the originally proposed 25-employee minimum, and the deadline to register is November 1, 2022.
The law requires pertinent employers to either provide long term savings, such as Simple IRAs, 401k, or similar retirement savings programs to employees; or to enroll employees into the state sponsored Secure Choice Savings Program, which is free of charge. Employers are not required to invest or pay into Secure Choice. Instead, employees would have a small percentage of their pay automatically deducted from their regular pay and invested into a state insured retirement savings account. Employees have the right to opt-out. The Illinois Treasurer’s office runs the program.
Illinois Secure Choice is a long term savings option that must be offered to all workers if your business does not have an alternative. The retirement savings program, sponsored by the State of Illinois, can be declined (opt-out) by the employee if they do not want wages removed from their paycheck. This program involves automatic payroll contributions of up to 10% of the employee’s wages.
Does it apply to me?
As an employer, you are required to register, by November 1, 2022, if each of the following are true:
- You do not already sponsor a qualified retirement plan;
- You had five or more employees in the previous calendar year; and
- You have been in business for at least two years.
Applicable employers should have received letters or emails outlining the program and the registration process.
How Do I Join Illinois Secure Choice-Retirement Savings Program?
You can register your company at ilsecurechoice.com. You will need your Federal Employer Identification or Tax Identification Number (EIN/TIN) and a Secure Choice Access Code. The Access Code can be found in the letters or emails sent to your business. If you cannot locate your Access Code, you may request one here.
Registration is open now, and the deadline is November 1, 2022. If you have five or more employees and have been in business for at least two years you should register now. This will avoid financial penalties. After you register you will setup an account and upload your employee roster. Illinois Secure Choice will then notify your employees about the program and your employees will have 30 days to opt out of the program. After the 30-day opt-out window, you will begin sending employee contributions for the employees who did not opt out.
If you have any questions about whether Illinois Secure Choice applies to your business, or would like assistance in registering for this program please contact the professionals at Anthony J. Madonia & Associates to see how our team can help you.