Byline: JERRY GEISEL
WASHINGTON-New Internal Revenue Service guidance will give employers with 401(k) plans more flexibility in automatically enrolling employees in the plans.
Such programs address a real-world problem: employees who haven't told their employer whether they will participate in the 401(k) plan. In some cases, as many as 20% of employees don't say one way or another if they will participate.
To address that problem, roughly 15% of employers now offer so-called automatic enrollment plans, which the IRS first gave its blessing to about five years ago. Such plans pass muster provided they are explained to employees and employees have the opportunity to opt out.
But since that initial IRS green light, new questions have arisen about how employers can design the plans, which the IRS has addressed in its most recent guidance. The guidance was provided in an …
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