As we come to the end of 2022 and look ahead to the coming year, here is a checklist for employee benefit plans that addresses key tax planning and compliance topics. The information contained in this article is based on enacted tax laws and policies as of the publication date and is subject to change based on future legislative or tax policy changes.
- Make sure to withhold deferrals on year-end bonuses unless bonuses are specifically excluded from plan compensation. If your plan allows participants to make special elections on bonus pays, make sure to get written documentation of any special elections made.
- Make sure any forfeitures are being used.
- If participants are eligible to participate and have opted out, make sure that you have documentation to support that they were provided enrollment information and that they have opted out.
- Make sure any terminated participants that are over age 72 have received their required minimum distribution.
- NEW for 2022: The Secure Act requires employers to begin allowing employees that work at least 500 hours for 3 consecutive years (beginning with 2021) to make deferral contributions beginning in 2024. Make sure you are keeping record of the hours for your part-time employees.
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