Earlier this year, the Internal Revenue Service (“IRS”) released proposed guidance addressing the automatic enrollment requirements introduced under SECURE 2.0 (“IRS Guidance”).  Essentially, SECURE 2.0 required that, with limited exception, all new 401(k) and 403(b) plans established on or after December 29, 2022 (“Effective Date”) must include an automatic enrollment feature (“Mandatory Auto Enroll”).  Mandatory…

The tax code governing 401(k) plans was written to prevent qualified retirement plans from overly favoring Highly Compensated Employees (HCEs). A series of non-discrimination tests were devised to measure whether a plan’s design or operation lends to favoring the HCEs over the Non-Highly Compensated Employees (NHCEs). All year end testing begins with the coverage test…

The tax code governing 401(k) plans was written to prevent qualified retirement plans from overly favoring highly compensated employees (HCEs). A series of non-discrimination tests were devised to measure whether a plan’s design or operation tends to favoring the HCEs over the nonhighly compensated employees (NHCEs). In our last installment we discussed how the Average…