MARYLAND RETIREMENT PLAN MANDATE: HELP BUSINESS OWNERS BENEFIT

  • With statewide rollout of MarylandSaves, compliance is required by employers if they:

    • Have been in operation for at least two calendar years
    • Have at least one employee age 18 or older
    • Use an automated payroll system
    • Do not offer a qualified retirement plan

    Those who haven’t yet adopted an employer-based plan have two choices:

    • ▾
      Contact a Regional Sales Consultant

What You Should Know

    • ▾
      Deadline:

      December 31 of each year:
      Employers must register for Maryland$aves and begin sending payroll contributions or claim their exemption to qualify for the $300 SDAT annual report filing fee waiver for the following year.
    • ▾
      Requirements:

      Employers that:

      • Have been in operation for at least two calendar years
      • Have at least one employee age 18 or older
      • Use an automated payroll system
      • Do not offer a qualified retirement plan
    • ▾
      Penalties for Non-Compliance:

      At this time, there are no penalties if an employer does not offer MarylandSaves or another retirement plan. However, employers that participate in the program will receive a waiver of the $300 filing fee for the annual report that business entities must file. Employers do not have fiduciary responsibility for the program, and it is not covered under ERISA.

MARYLANDSAVES OR CUSTOMIZED PLAN?

MarylandSaves is a basic, one-size-fits-all retirement savings program for businesses that do not wish to sponsor a plan for their own employees. Yet there are many businesses that would be better served with a plan from TRA that’s customized to their needs.

 

MarylandSaves Custom 401(k) from TRA
Pre- and Post-Tax Deferrals Roth IRA with automatic payroll deductions Pre-tax or Roth elective deferral contributions
Contributions Initial default rate of 5%, with 1% auto-escalation each year. Employees can opt in or out or choose a different deferral rate at any time Lesser of 100% of compensation or $24,500
Catch-Up Contributions Determined by IRA contribution limits $8,000 annually for those age 50 and older
Employer Match Not available Available
Income Limit Determined by IRA contribution limits No income limits
Investment Choices Age-appropriate target date fund plus 2 elective options (after accumulating $1,000 in emergency savings) Can provide a wide variety from top asset managers
Automated Payroll Integration Available Available
Customizable for businesses Not customizable Yes – Plans are designed to meet the employer’s needs – Traditional 401(k), Safe Harbor, Profit Sharing, Cash Balance
Tax Credit and Filing Fees No retirement plan startup tax credit through MarylandSaves. Eligible employers may receive a $300 Maryland SDAT annual report filing fee waiver Yes – 100% of the expenses paid up to the greater of $500 or the lesser of $250 for each non-HCE’s. A maximum tax credit of $5,000 per year would be available for 3 years

TRA Plans to Consider

For Maryland businesses who want to sponsor a retirement plan, some plans to consider include:

• 401(k)
• Safe Harbor 401(k)
• Cross Tested Profit-Sharing Allocation
• 401(k) plus Cash Balance Plan

Other alternatives to MarylandSaves include SIMPLE 401(k) Plans, Group 401(k) Plans (MEPs, PEPs and Aggregation Programs), and 403(b) Plans (for non-profits).

COMPARE PLANS

Working closely with you, TRA will create a customized plan that meets your client’s business. We partner with top recordkeepers and investment managers around the country and deliver exceptional client service. We also offer 3(16) Plan Administration Relief Services (PARS) to relieve business owners of day-to-day plan administration responsibilities and manage their fiduciary risk.

Complete the form below and one of TRA’s Regional Sales Consultants will be in contact with you.

Pattern

Consider TRA's 3(16) Fiduciary Services & Plan Administration

To alleviate the day-to-day administrative burdens of yours or your clients retirement plans.
PLAN NOW