Below is an outline of the newly released 2021 contribution limits, which will take effect on January 1, 2021. There are not many increases in 2021. The key increases are: Annual compensation limit is increased from $285,000 to $290,000 Annual additions limit for defined contribution plans is increased from $57,000 to $58,000 Social Security Wage Base is increased from $137,700 to $142,800 SEP Threshold is increased from $600 to $650 ESOP: Account Balance is increased from

Safe harbor 401(k) plans are among the most popular types of 401(k) plans used by small businesses. These plans help owners maximize the annual contributions made to their accounts because they automatically pass ADP/ACP and other top-heavy nondiscrimination tests. However, to achieve the Safe Harbor status, the plan must meet certain contributions and participant disclosure requirements. Let's talk a little more about the rules that Safe Harbor plans bring with them. If, as

When a business owner decides to start up a 401(k) or some other type of retirement plan, the inevitable question is "who will take care of the planning and administration?" That's a fair question, but Plan Sponsors will be glad to learn that there are firms dedicated to plan administration. Let's take a few moments to explore everything you ever needed to know about Retirement Plan Consultant (RPC). What is a RPC and what do they do? A Retirement Plan Consultant is a comp

It is no secret that a corporate 401(k) plan provides many benefits to both employers and employees. But what is perhaps lesser known is that how that plan is designed has a huge impact on the resulting benefits. Business owners must identify the features and options they want to see in a plan before sitting down with an administrator. Owners should consider the needs of their employees when designing a plan. When owners include their employees’ wishes in their planning, they

Every so often, all qualified retirement plans must be updated to reflect legislative or regulatory changes. Some of these updates are made through plan amendments, while others require plan documents to be rewritten—known as "restating" the plan. The deadlines for adopting such updates are usually dependent on the type of plan and plan documents. For example, defined contribution plans (such as a 401(k)) are generally restated every six years. Amendments may still be require

By now, you have heard a lot about the retirement account legislation changes that came with the passing of the Setting Every Community Up for Retirement Enhancement (SECURE) Act in December 2019. We are focusing on just one of those changes in this article: the increased required minimum distribution (RMD) age for all retirement accounts. Before the SECURE Act, someone with money in a traditional IRA or employer-sponsored retirement plan was required to begin taking withdraw