Colorado Retirement Plan Requirements for Employers
Colorado employers may need to take action if they do not already offer a qualified retirement plan. Under Colorado SecureSavings, covered employers generally must either offer a qualified employer-sponsored retirement plan or facilitate the state-sponsored retirement savings program. Covered employers are generally those that have been in business for at least two years, have five or more employees, and do not already offer a qualified retirement plan.
Who Colorado SecureSavings Applies To
Colorado SecureSavings generally applies to employers that are registered to do business in Colorado, have been in business for at least two years, have five or more employees, and do not already offer a qualified retirement plan. If an employer already offers a qualified plan, the employer can certify an exemption instead of participating in the state program.
Your Two Main Compliance Paths
Colorado employers generally have two main ways to comply. The first is to offer a qualified private retirement plan, such as a 401(k), SEP IRA, SIMPLE IRA, or another qualifying plan. The second is to register for Colorado SecureSavings and facilitate the state-sponsored Roth IRA program for eligible employees. Employers that already offer a qualified plan can generally certify their exemption instead of participating in the state program.
Why Some Employers Choose a Private Plan
Some employers prefer a private retirement plan because it can provide more flexibility in plan design, employer contribution strategy, and overall employee benefits positioning. Depending on the employer’s size, budget, and goals, options such as a 401(k), SEP IRA, or SIMPLE IRA may be a better long-term fit than defaulting to the state program. Employers that adopt a qualified plan can generally remain outside the Colorado SecureSavings program by certifying their exemption.
What Happens If You Do Nothing
Colorado SecureSavings deadlines for covered employers are already in effect, and the program is actively enforced. The statute authorizes penalties for noncompliance, including fines that can reach up to $100 per eligible employee per year, subject to a maximum annual cap. Employers should review their status promptly rather than assume the requirement does not apply to them.
Potential Tax Credit Opportunity
For some small employers, starting a new retirement plan may make them eligible for federal retirement plan startup tax credits. These credits may help offset certain startup and administrative costs for eligible employers that establish a new qualified retirement plan. Tax treatment depends on the employer’s situation, so employers should review eligibility carefully with their tax advisor.
How National Benefits Consultants Helps
National Benefits Consultants helps Colorado employer groups review retirement plan options and understand their compliance path. The goal is to help employers choose a practical solution that supports compliance and fits the business.
Need Help Reviewing Your Colorado Compliance Options?
Need help reviewing your Colorado retirement plan compliance options? Call 720-488-9892 or contact National Benefits Consultants to discuss retirement plan options, exemption status, and Colorado SecureSavings compliance.