Understanding the Illinois Secure Choice Savings Program Act

The Illinois Department of Revenue has issued an informational bulletin on the enforcement of the Illinois Secure Choice Savings Program Act (Secure Choice Program).

Under the Illinois Secure Choice Savings Program Act, the following Illinois employers must either begin offering a qualified plan or automatically enroll their employees into the Illinois Secure Choice Savings Program (“Secure Choice”):

  • An employer with at least five (5) employees (as determined by Form IL-941 filed by the employer),
  • An employer who has been in business for two or more years, and
  • An employer who does not offer a qualified retirement plan.

Secure Choice is a program administered by the Illinois Secure Choice Savings Board to provide a retirement savings option to private-sector employees in Illinois who lack access to an employer-sponsored plan. Employers who do not meet their required enrollment deadlines or report an exemption from Secure Choice may be subject to financial penalties. Employers who do not comply will receive a Tier I penalty of $250 per employee, calculated for the first calendar year of noncompliance or a Tier II penalty of $500 per employee for each subsequent calendar year the employer is non-compliant. 

The Department of Revenue is responsible for enforcing penalty provisions for non-compliant employers. The Department will begin issuing IDOR-2P-NT (Notice of Proposed Assessment) and IDOR-2-BILL-NT (Notice of Assessment) in February 2023. Employers can avoid proposed assessments by complying within 120 days of the notice date.

Employers who receive a notice should take one of the following actions:

  • Register for and facilitate the Secure Choice Program.
  • Report an exemption from the Secure Choice Program.
  • Amend IL-941 to correct an incorrect employee count reported on your payroll tax return.
  • Pay a balance due or request an administrative hearing.

For more information about the Illinois Secure Choice rules, visit here or contact Cray Kaiser at 630-953-4900.