Offering Retirement Plans to Long-Term Part-Time Employees

November 21, 2022 | Authored by Vincent Pasini CPA

On December 20, 2019 the SECURE Act was signed into law. One provision of the SECURE Act requires employers to offer long-term part-time employees eligibility to participate in their retirement plan. A long‐term part‐time employee is defined as an employee who has worked at least 500 hours per year for the previous three years. It is important to note, following the issuance of IRS Notice 2022-33, that the hours prior to 2022 are not considered. Based on these rules, the earliest entry for these employees would be January 1, 2025. However, plan sponsors should begin to consider this provision now if it will result in a change to their plan, as they are required to track hours and offer participation beginning in 2025.