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SECURE 2.0 and Pension-Linked Emergency Savings Accounts: New DOL and IRS Guidance, Fees, Limitations, Reporting

Note: CPE credit is not offered on this program

Recording of a 90-minute premium CLE video webinar with Q&A

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Conducted on Tuesday, August 27, 2024

Recorded event now available

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This CLE webinar will provide ERISA counsel, plan sponsors, and employers with an analysis of pension-linked emergency savings accounts (PLESAs) under the SECURE Act 2.0. The panel will discuss new DOL and IRS guidance, PLESA requirements outlined in the SECURE Act 2.0, permissible fees, investment requirements, anti-abuse rules and guidance, and reporting and disclosure requirements. The panel will also discuss compliance challenges and next steps for plan sponsors and employers.

Description

The SECURE Act 2.0 created PLESAs, which is a special retirement plan feature providing a flexible savings opportunity for eligible non-highly compensated employees. The requirements for these accounts under the SECURE Act must be carefully examined by counsel and plan sponsors to determine whether or not to amend their defined contribution plans to make PLESAs available.

PLESAs are short-term savings accounts within a defined contribution plan, such as a 401(k) or 403(b) plan. These accounts allow eligible non-highly compensated employees to make Roth (after-tax) contributions up to a specified amount that can be withdrawn at any time at their discretion without early distribution penalties or satisfying other requirements. This is a significant feature aimed at assisting non-highly compensated employees, subject to certain requirements and limitations under the SECURE Act 2.0.

Recently, the DOL and IRS issued guidance providing clarification on (1.) eligibility and participation; (2.) contributions, withdrawals, and distributions; (3.) investment requirements; (4.) reporting and disclosure requirements; and (5.) application of IRS anti-abuse rules. ERISA attorneys, plan sponsors, and employers must recognize the impact of PLESAs on defined contribution plan design, implementation, and administration and prepare for IRS and DOL interpretations and requirements.

Listen as our panel discusses including PLESAs within defined contribution plans, key provisions and requirements under SECURE 2.0, and best practices for ERISA compliance for plan sponsors and employers.

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Outline

  1. Overview of PLESAs under SECURE Act 2.0
  2. Plan design and implementation considerations
  3. Administration and compliance challenges
  4. Other key items and best practices for counsel and plan sponsors

Benefits

The panel will review these and other vital matters:

  • What should plan sponsors and employers know about PLESAs under SECURE 2.0?
  • What are the key requirements, limitations, and potential challenges when including PLESAs as part of a defined contribution plan?
  • What are the risks and potential pitfalls?
  • What are the key considerations, best practices, and next steps for counsel?

Faculty

Koehler, Philip
Philip J. Koehler, Esq.

Partner
Best Best & Krieger

Mr. Koehler brings more than 30 years of tax and employee benefits plans legal experience to his Business practice...  |  Read More

Mohs, Martha
Martha Mohs

Shareholder
Reinhart Boerner Van Deuren

Ms. Mohs is a shareholder in the firm’s Employee Benefits Practice. She counsels Taft-Hartley, corporate and...  |  Read More

Rothman, Jason
Jason A. Rothman

Partner
Calfee Halter & Griswold

Mr. Rothman advises publicly traded companies, closely held businesses and nonprofit organizations on all aspects of...  |  Read More

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