Total Articles: 3
Bill Would Allow Employees to Automatically Enroll in IRAs
Senators John Kerry (D-MA) and Jeff Bingaman (D-NM) have reintroduced legislation that would establish an automatic individual retirement account (IRA) enrollment program for employees at firms with more than 10 employees that do not already offer retirement plans. The Automatic IRA Act of 2011 (S. 1557) would enable employees to contribute to these IRAs on a voluntary basis through automatic payroll deductions. Employers would be provided a $250 tax credit for each of the first two years of the program’s operation to offset costs associated with its establishment.
Mandatory IRAs Proposed.
Employers under the Patient Protection and Affordable Care Act are not required to provide health care coverage, but a failure to do so may result in monetary penalties. Is this the end of federally-required employee benefits? Maybe not!
Check Your Individual Retirement Account Agreements.
A recent Department of Labor Advisory Opinion (Ad Op 2009-03A) discussed the effect of certain language that is often found in brokerage agreements that could be used in connection with Individual Retirement Accounts offered by brokerage firms. The Department advised that the language in question would result a series of "prohibited transactions," which would have the effect of invalidating the customer's IRA.
