Second State-Run Retirement Plan Deadline Approaches
Employers with 26 to 99 employees have until Oct. 31 to register with the state-run retirement plan or opt out of the program.
It is the second wave of deadlines for employers across the state.
Employers with five to 25 employees have until March 30, 2022 to register.
The Connecticut Retirement Security Authority launched MyCTSavings in May of 2022
Connecticut employers with five or more employees—each paid a minimum of $5,000 in the calendar year—are required by law to join the program if they don’t offer employees a retirement plan.
Qualifications and Responsibilities
Employers that offer employees qualified retirement plans are exempt from participating, but still must certify that exemption.
Qualified employer-sponsored retirement plans include a those under Internal Revenue Code sections 401(a) (including a 401(k) plan); qualified annuity plan under section 403(a); tax-sheltered annuity plan under section 403(b); Simplified Employee Pension plan under section 408(k); a SIMPLE IRA plan under section 408(p); or governmental deferred compensation plan under section 457(b).
Qualified, employer-sponsored plans do not include payroll deduction IRAs.
Eligible employees will be automatically enrolled in the program. Once employees are enrolled, they can choose to opt out of the program.
By default, employees who are enrolled will see a 3% deduction from their gross pay, but they can choose to manually adjust their contribution rate at any time.
As a Roth IRA, the state-run plan does not provide the pre-tax benefits of other retirement plans offered by numerous private sector institutions.
In addition, the state plan is not subject to the federal Employee Retirement Income Security Act, which sets minimum standards for most retirement and health plans to protect enrolled individuals.
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