Retirement Plans

A safe harbor 401(k) plan requires the employer to make a qualifying contribution, either a 3 percent non-elective contribution to all eligible employees or a matching contribution of 100 percent on the first 3 percent and 50 percent on the next 2 percent of employee deferrals. In return, the plan is deemed to satisfy ADP/ACP nondiscrimination tests, which allows highly compensated employees to defer the maximum amount without restriction. Safe harbor plans are ideal for businesses where owners and key employees want to maximize deferrals without the risk of failed testing. ALKEME models the cost of safe harbor contributions against the compliance risk and contribution refunds associated with traditional 401(k) testing.

Selecting a recordkeeper involves evaluating fees, investment platform breadth, technology and participant experience, compliance support, and service quality. ALKEME conducts a structured RFP process, soliciting proposals from multiple recordkeepers and benchmarking each against industry fee studies. We evaluate per-participant fees, asset-based fees, transaction charges, and revenue-sharing arrangements to ensure total plan costs are reasonable. We also assess the participant digital experience, mobile tools, call center responsiveness, and integration capabilities with your payroll system.

As a plan fiduciary, you must act solely in the interest of plan participants, follow the terms of plan documents, diversify plan investments to minimize the risk of large losses, and pay only reasonable plan expenses. You are also responsible for selecting and monitoring service providers including investment managers, recordkeepers, and third-party administrators. Fiduciary breaches can result in personal liability, DOL investigations, and participant lawsuits. ALKEME helps you establish a fiduciary governance committee, document prudent decision-making processes, conduct annual fee benchmarking, and engage investment fiduciaries who share or assume investment selection responsibilities.

The SECURE 2.0 Act significantly enhanced startup tax credits for small employers. Eligible businesses with up to 50 employees can receive a tax credit of 100 percent of plan startup costs, up to 5,000 dollars per year for the first three years. An additional credit of up to 1,000 dollars per employee is available for employer contributions made during the first five years of the plan. These credits can substantially offset or even eliminate the cost of launching and funding a new retirement plan. ALKEME helps small employers quantify these credits and structures plan implementation to maximize the available tax benefits.