The Small Business Legislative Council on Jan. 28 provided a webinar called “Understanding the SECURE Act — What it Could Mean for You." Paula Calimafde, an attorney with Paley Rothman Law Firm and president and general counsel of the SBLC, presented.
Most retirement plan changes, Calimafde said, are minor. Some changes will be helpful, but others will cause more work for small plans.
The open multiple employer plan (MEP) change will be important, she said.
A MEP, or pooled provider plan, is a group of plans that band together for lower plan administration costs, lower investment fees in mutual funds investments and reduced fiduciary responsibility. MEPs no longer will be burdened with filing annual IRS forms.
The SECURE Act removed two roadblocks that historically kept small businesses from joining MEPs, Calimafde said. Plan administrators have cast doubts on the ability of a MEP to reduce administrative fees, but other advantages will be significant, she said.
What remains unclear is how much flexibility regarding investments and plan design an employer will have to give up to join a MEP, she said.
The most significant change for those who already have saved for their retirement is the elimination of the stretch IRA, Calimafde said.
A recent Forbes article explains the terminology and what you need to know about changes to your retirement.