Minnesota Secure Choice Retirement Program

Starting January 1, 2025, private employers, including non-profits, with five or more employees that has been engaged in business in Minnesota for at least a year and who do not currently offer a retirement plan will be required to allow employees (18 years of age and older) to participate in Minnesota’s Secure Choice Retirement Program (“Retirement Program”). The option for employees is to participate in either a pre-tax IRA or after-tax Roth IRA. However, employees can opt out of participation. With an opt-out provision, it is important that the employer has documentation in writing from the employee that the employee has opted-out. Without said documentation, the employee has opted-in to participate and the employer has to administer the employee’s contributions through payroll. Employers are required to provide at least 30 days notice to eligible employees prior to the first paycheck from which contributions will be deducted.

The funds in an employee’s retirement plan through this Retirement Program are solely funds that the employee contributes. There is no match or monetary amount that an employer contributes to the Retirement Program. While employer’s costs are limited to modifying their payroll to allow for the change, deducting the contributions and sending them to be deposited, it may be more beneficial to the employer and its employees for the employer to offer a retirement plan to its employees.

Spangler and de Stefano, PLLP advises business owners on complying with employment laws.

The material contained herein is for informational purposes only, and is not intended to create or constitute an attorney-client relationship between Spangler and de Stefano, PLLP and the reader. The information contained herein is not offered as legal advice and should not be construed as legal advice.