All employers with 10 or more employees in New York State must have an employer sponsored retirement plan within 9 months of the October 21, 2021 date the law was signed by NYS Governor Hochul.
If your business does not currently offer a retirement plan, you can either adopt one that will provide the most tax savings for you, or you must participate in the New York State Automatic IRA Deduction Plan (NYS Secure Choice Savings Plan).
Things to Know:
- Part-time employees and business owners are included in the employee count.
- If you have not yet been in business for two years, you are exempt from the mandate until you reach the two-year mark.
- Employee enrollment is automatic, but employees can opt-out at any time.
- Tax credits are available to businesses to help offset the costs of starting a SEP, Simple IRA or 401(k).
- Tax-Qualified Plans will have much higher contribution limits, the ability to customize the plan and choose the investments within the plan. The NYS Automatic IRA Deduction Plan does not offer those options.
Even if your business does not meet the requirements for the NYS mandate, your profitable business (and you!) can benefit from a properly designed retirement plan. Ask your CPA for more details.
Honorine M. Campisi, CPA