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Proposed Regulations on New Automatic Enrollment Requirement for 401(k) and 403(b) Plans

ARTICLE | February 14, 2025

Authored by Schlenner Wenner & Co


The Department of the Treasury and the Internal Revenue Service have issued proposed regulations addressing the SECURE 2.0 Act provisions. This includes a provision requiring newly-established 401(k) and 403(b) plans to automatically enroll eligible employees beginning with the 2025 plan year.

The plan must automatically enroll the employee at an initial contribution rate of at least 3% of the employee’s pay and automatically increase the rate by one percentage point each year until it reaches at least 10% of pay. This requirement generally applies to plans established after Dec. 29, 2022, with some exceptions.

Please review the full IRS article here:  https://www.irs.gov/newsroom/treasury-irs-issue-proposed-regulations-on-new-automatic-enrollment-requirement-for-401k-and-403b-plans

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