View all text of Subpart B [§ 410 - § 417]
§ 414A. Requirements related to automatic enrollment
(a) In general
Except as otherwise provided in this section—
(1) an arrangement shall not be treated as a qualified cash or deferred arrangement described in section 401(k) unless such arrangement meets the automatic enrollment requirements of subsection (b), and
(2) an annuity contract otherwise described in section 403(b) which is purchased under a salary reduction agreement shall not be treated as described in such section unless such agreement meets the automatic enrollment requirements of subsection (b).
(b) Automatic enrollment requirements
(1) In general
(2) Allowance of permissible withdrawals
(3) Minimum contribution percentage
(A) In general
An eligible automatic contribution arrangement meets the requirements of this paragraph if—
(i) the uniform percentage of compensation contributed by the participant under such arrangement during the first year of participation is not less than 3 percent and not more than 10 percent (unless the participant specifically elects not to have such contributions made or to have such contributions made at a different percentage), and
(ii) effective for the first day of each plan year starting after each completed year of participation under such arrangement such uniform percentage is increased by 1 percentage point (to at least 10 percent, but not more than 15 percent) unless the participant specifically elects not to have such contributions made or to have such contributions made at a different percentage.
(B) Initial reduced ceiling for certain plans
(4) Investment requirements
(c) Exceptions
For purposes of this section—
(1) Simple plans
(2) Exception for plans or arrangements established before enactment of section
(A) In general
Subsection (a) shall not apply to—
(i) any qualified cash or deferred arrangement established before the date of the enactment of this section, or
(ii) any annuity contract purchased under a plan established before the date of the enactment of this section.
(B) Post-enactment adoption of multiple employer plan
(3) Exception for governmental and church plans
(4) Exception for new and small businesses
(A) New business
(B) Small businesses
(C) Treatment of multiple employer plans
(Added Pub. L. 117–328, div. T, title I, § 101(a), Dec. 29, 2022, 136 Stat. 5275.)