How the Mandatory Business Registration for Employers Will Impact Your Business
New Jersey is making significant efforts to help secure the financial futures of its citizens with the launch of a new retirement savings program, RetireReady NJ. As part of the New Jersey Secure Choice Savings Act, N.J. businesses with 25 or more employees that have been in business for two or more years and do not currently have a qualified retirement savings plan will need to register for the program. This new regulation aims to increase retirement savings among workers who might not have access to employer-sponsored retirement plans.
What is RetireReady NJ?
RetireReady NJ is a cost-free, state-sponsored retirement savings program that provides employees with an easy and secure way to save for retirement. Employees can opt to have either Roth or Traditional IRA contributions automatically deducted from their paychecks and deposited into their individual IRAs. Employees are automatically enrolled to contribute 3% of their pretax earnings, unless they decide to adjust their rate or opt out of the program. In compliance with IRS guidelines, a maximum of $6,000 can be contributed to the plan per year (or $7,000 for employees aged 50 and older). This program does not require employers to make matching contributions or manage the outcomes of employee accounts. Vestwell State Savings, LLC, will administer the program and handle the administrative details.
Why RetireReady NJ Matters For Your Business
For small businesses being able to offer a robust benefits package is crucial for attracting and retaining top talent. Here are some things you need to know about this new mandate and how it might affect your business:
- There is no cost for employers to participate in the program. Payroll deductions are easily integrated into an employer’s existing payroll system, making participation simple and convenient.
- Deadlines for companies who have been in business for at least two years that do not offer a qualified retirement savings plan are as follows:
- Companies with 40 or more will need to register for RetireReady NJ by September 15, 2024.
- Companies with 25 to 39 employees will need to register for RetireReady NJ by November 15, 2024.
- To register, you will need your business’ Federal Employer Identification Number (EIN) and your RetireReady NJ Access Code. The Access Code can be found on your initial notice from RetireReady NJ. If you are unable to locate your Access Code, you can look it up at nj.gov. Employers that already provide a qualified retirement savings plan do not need to register and should certify their exemption from the RetireReady NJ program online.
More Information
RetireReady NJ will present informative webinars for employers to learn more about the program and its requirements. Employers are encouraged to register for these webinars at RetireReady.nj.gov and to visit the website for additional information.
If you have questions about RetireReady NJ, please contact us for assistance. As always, our job is to make your life less taxing.