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Daniel R. Cuddy, CPA, CFP®

Personal Financial Representative


Cuddy Financial Services

7 William Street

Auburn, NY 13021


Phone:  315-252-3600

Fax:      315-252-3625


Email: dcuddy@cuddyfinancial.com

2023 Tax Planning Guide

SECURE 2.0 Act for Businesses

Employers with 50 or fewer employees get a tax credit equal to 100% of qualified start-up costs for a 401(k) or 403(b) plan. Additionally, plan sponsors may receive another credit for five years up to $1,000 per employee if they meet certain requirements. These credits phase out for employers with 51-100 employees.

Businesses operating at least three years and sponsoring 401(k) plans with at least 11 employees must automatically enroll their workers in their plans at a rate between 3% and 10% and payroll-deduct contributions at an additional 1% annually until reaching 10%. They may deduct contributions up to a maximum of 15% afterward. Smaller or newer businesses are exempt from this requirement. Employees may opt out.

A laundry list of changes will change how plans operate and comply with regulations. They include: receiving nine and a half months after a plan year to correct reasonable errors administering auto enrollment and contribution escalators, getting more leeway to self-correct some compliance issues, modifying top-heavy testing, effective in 2024 and the ability to offer small incentives, such as gift cards, to encourage employees to participate in their plans. Also, new guidance about benchmarking target date funds against indices and a federal “lost and found” database to find lost retirement savings are expected in 2024.

Small businesses allowing military spouses to immediately contribute to and vest in any employer matches in their retirement plans qualify for an annual tax credit of $200 per each spouse of an active military member.

Understand that this list of changes is not exhaustive and some specifics may change over the next year, so consult your tax professional.


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Cuddy Financial Services and LTM Client Marketing are unrelated companies. This guide was created by LTM Client Marketing and was not written or created by the named financial professional and does not necessarily represent the views and opinions of Avantax Wealth Management® or its subsidiaries.
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