On August 31 of this year, President Trump signed an executive order to “strengthen retirement security.” Included in the order was a directive for the IRS to review the rules governing Multiple Employer Plans (MEPs), improving and lowering the cost of retirement plan disclosures, and updating the life expectancy tables for required minimum distributions. In unusually rapid fashion, the Department of Labor (DOL) issued proposed rules on MEPs on October 23, 2018.
The proposed rules, which are subject to a public comment period, authorize Association Retirement Plans (ARPs) and Professional Employer Organizations (PEOs) to sponsor defined contribution plans for their members. The ARP needs to be based on a common industry or geography and would also allow self-employed persons to join a sponsoring association. Member sponsors would still have fiduciary responsibilities and filing requirements.
Significantly, the rules do not address the concept of an “open” MEP, which would allow unrelated employers to join together in a single plan. This issue may be addressed by pending legislation in Congress during the lame duck session.
For questions or more information, please contact Richard Green at firstname.lastname@example.org or (844) 252-7337.