Washington – The ERISA Industry Committee (ERIC) submitted comments to the Internal Revenue Service (IRS) on how the new federal Saver’s Match program should work with employer-sponsored retirement plans. ERIC asked the IRS to choose the simplest way to move the government’s contributions into workers’ 401(k) plans and avoid placing new data-reporting demands on employers.
Created by the SECURE 2.0 Act of 2022, the Saver’s Match starts in 2027. It allows the U.S. Treasury to deposit up to $1,000 into the retirement account of an eligible worker who is saving for retirement. The payment is made after the worker files a tax return.
“Large employers want the Saver’s Match to work for their employees, and the easiest way to get there is to use the systems plans already have,” said Andy Banducci, Senior Vice President, Retirement and Compensation Policy at ERIC. “Moving these dollars through a standard rollover lets workers benefit without forcing plans to build new tracking systems or send sensitive employee data to the government. The IRS has already confirmed that plans won’t be required to accept these contributions, and we appreciate that flexibility.”
ERIC supported the IRS’s proposed “Registration Path,” which would deliver the money to a worker’s plan as an ordinary rollover, so plans would not need to track it separately. ERIC also cautioned against options that would require plans to send employee data to the government or add extra steps for workers and plans.
If plans are allowed to accept payments directly from Treasury, ERIC asked the IRS to provide the totals plans must report on their annual Form 5500 and to offer model plan language.
Read ERIC’s submitted comments here.