It seems like ancient history, but back in 2016, Maryland passed a law requiring any covered employer (i.e., one that didn’t have its own retirement plan and used a payroll system or service) to participate in the Maryland Small Business Retirement Savings Program - MarylandSaves.
The program was set to launch in 2020, but like with many things, COVID caused some delays. The implementation is now scheduled for September 2022, and we cover the details you need to know.
What Exactly is MarylandSaves?
MarylandSaves is a state-sponsored program intended to make it easy for small businesses to offer employees an automatic, low-cost emergency savings and retirement plan. Employers will have no payment obligations or federal reporting requirements, and nothing will have to be paid to MarylandSaves for the service.
What If Employees Don't Want To Participate?
If you’re a covered employer and have employees 18 years or older, your employees will be enrolled automatically, no matter what. But the program is voluntary and employees will have the ability to opt out.
There are pros and cons to the MarylandSaves program. We suggest you consider what implementing your own 401K plan would look like in comparison to the Maryland plan to ensure you’re doing what’s best for your business. To learn more about the MarylandSaves program, check out this document.
There are many facets to this new law, so if you meet the definition of a covered employer, please reach out to your payroll provider, the State of Maryland or contact us here or call 800.899.4623 for more information.