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Decoding the Mandatory Retirement Plans for Small Businesses: Illinois Secure Choice Program

This law has already gone into effect, but from conversations with some of my business clients, it is poorly understood and not being complied with by the smaller ones.

The reduction in the number of employees became effective November 1, 2023. Illinois now requires every Illinois employer with five or more employees to offer them a retirement program or facilitate signing up for Secure Choice, a State of Illinois-facilitated retirement program. Whether you decide to provide your own retirement plan or not, it doesn’t require matching funds; it just requires that you offer them a retirement plan.

This applies to full-time and part-time employees.

Only private-sector employers that do not offer a qualified retirement plan, had at least five employees in every quarter of the previous calendar year, and have been in business for at least two years must facilitate Illinois Secure Choice.

If you have five or more employees (full-time or part-time), you must register your business or file for an exemption.

When you register, you’ll submit information for each eligible employee. This will begin with a Roth IRA in each employee’s name. Employees will then have 30 days to decide whether to participate or opt-out.

If they do not make a selection, they will be automatically enrolled in the program. Suppose they enroll in the program or don’t opt out. In that case, you are responsible for facilitating payroll deductions each payroll period through bank transfer. These payroll deductions will be added to the employee’s Roth IRA account and invested according to their selections.

You can find more information about the program at or Google “Illinois Secure Choice.”

Questions? Contact us at 618.713.9284.


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