Regulatory Roundup August 2021September 03, 2021
This month, Illinois amended its Secure Choice program, while the U.S. Dept. of Education extended the pause on student loan repayments.
With the summer vacation season winding down, there were only a couple of legislative updates in the month of August. The state of Illinois adopted amendments to its Secure Choice program for employers who do not already offer a savings plan to their employees, while the United States Department of Education announced a final extension to the pause on student loan repayments. Learn about these changes below in this month’s Regulatory Roundup.
The Illinois Secure Choice program was adopted earlier this year to give employees without an employer-provided savings plan the chance to save up for retirement through ongoing payroll deductions. In August, the state added certain amendments to the program, specifically in regard to updating eligibility requirements, contribution requirements, enrollment dates, and penalties for noncompliance. Under the amendments:
- The number of eligible employees needed to require an employer’s enrollment was lowered from 25 to 5.
- Automatic increases to contribution rates based on a provided schedule can go up to 10% of an employee’s wages.
- Employers with 15–25 employees must enroll by September 1, 2022, while those with 5–15 employees don’t have to enroll until September 1, 2023.
- Employers who fail to enroll an employee without reasonable cause will be subject to a penalty of $250 per eligible employee for the first year and $500 per eligible employee for each year thereafter.
At the federal level, the U.S. Department of Education announced its last extension for the pause on student loan repayments, interest, and collections through January 31, 2022. In addition to this extension the department also:
- Approved $1.5 billion in borrower defense claims, including full relief to claims that were either already approved or newly approved through this update.
- Reinstated $1.3 billion in loan discharges for borrowers who received a total and permanent disability discharge, while also protecting 190,000 other borrowers from potential loan reinstatement.
- Assisted 30,000 small business owners with student debt seek help from the Paycheck Protection Program (PPP).
Get more details on the compliance updates from August here:
Visit our Return to Work page to browse our resources to help you engage, rehire, and recruit in this new environment. You can also check out our Legislative Updates Related to Coronavirus (COVID-19) for a comprehensive summary of legislative changes and how Paylocity has responded with updates to our product to help you stay compliant. For the latest information and resources related to the coronavirus, check our COVID-19 Resources page often.
Be sure to bookmark our resource library and come back monthly for Regulatory Roundups of tax and compliance alerts you need to know. For any other frequently asked questions or general assistance, refer to our Administrator Support page for support contact information, quick how-to guides or training courses, important PEAK articles, and more. Don't forget to also follow us on Facebook, LinkedIn, and Twitter for urgent updates.
This information is provided as a courtesy, may change, and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney, or Advisor.
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