In early 2023, the Colorado SecureSavings Retirement Program (the Program) rolls out in three phases, based on employer size. Employers covered by the Program are required to facilitate through payroll deductions optional employee contributions to individual retirement accounts (IRAs) run by the state.
Covered employers are required to either offer employees a private IRA plan or register to provide eligible employees with access to the Program.
Covered Employers and Employees
An employer is covered and required to comply with the Program if it:
- Has been in business in Colorado for at least two years;
- Has employed at least five employees for at least 180 days; and
- Does not offer employees a private, tax-qualified retirement savings plan (e.g., a § 401(k) or § 403(b) plan, etc.).
An employee is eligible to participate in the program if they are:
- Age 18 or older; and
- Have been employed and paid taxable income by a covered employer for at least 180 days.
Registration Requirements
Covered employers will receive a notice from the state that they must register by the following deadlines:
- Employers with 50 or more employees by March 15, 2023;
- Employers with 15 to 49 employees by May 15, 2023; and
- Employers with five to 14 employees by June 30, 2023.
An employer that fails to register or apply for an exemption may be subject to a fine of up to $100 per employee per year, up to an annual maximum of $5,000.
The Program board is expected to implement rules detailing the process of employer withholding and remittance of contributions.
Next Steps for Employers
Covered employers who do not offer a retirement plan must ensure they complete registration for the Program and automatically enroll eligible employees by the applicable deadline. Covered employers should also work with their payroll provider to ensure that their payroll system is setup to deduct contributions. Covered employers are required to remit employees’ withheld contributions to the program fund within 14 days after the date they were withheld.
Employers who already offer a retirement plan, must certify their exemption when the Program fully launches.
