Bill Text: IL HB4719 | 2023-2024 | 103rd General Assembly | Engrossed

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Bill Title: Amends the Illinois Secure Choice Savings Program Act. Provides that participating employers may (rather than shall) designate an open enrollment period during which employees who previously opted out of the Secure Choice Savings Program may enroll in the Program. Provides that an employer shall retain the option at all times to set up a qualified retirement plan (rather than any type of employer-sponsored retirement plan). Removes offering an automatic enrollment payroll deduction IRA from a list of qualified retirement plans. Makes conforming changes.

Spectrum: Partisan Bill (Democrat 4-0)

Status: (Passed) 2024-07-19 - Public Act . . . . . . . . . 103-0681 [HB4719 Detail]

Download: Illinois-2023-HB4719-Engrossed.html

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1 AN ACT concerning employment.
2 Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4 Section 5. The Illinois Secure Choice Savings Program Act
5is amended by changing Sections 60 and 85 as follows:
6 (820 ILCS 80/60)
7 Sec. 60. Program implementation and enrollment. Except as
8otherwise provided in Section 93 of this Act, the Program
9shall be implemented, and enrollment of employees shall begin
10in 2018. The Board shall establish an implementation timeline
11under which employers shall enroll their employees in the
12Program. The timeline shall include the date by which an
13employer must begin enrollment of its employees in the Program
14and the date by which enrollment must be complete. The Board
15shall adopt the implementation timeline at a public meeting of
16the Board and shall publicize the implementation timeline. The
17Board shall provide advance notice to employers of their
18enrollment date and the amount of time to complete enrollment.
19The enrollment deadline for employers with fewer than 25
20employees and more than 15 employees shall be no sooner than
21September 1, 2022. The enrollment deadline for employers with
22at least 5 employees but not more than 15 employees shall be no
23sooner than September 1, 2023. The provisions of this Section

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1shall be in force after the Board opens the Program for
2enrollment.
3 (a) Each employer shall establish a payroll deposit
4retirement savings arrangement to allow each employee to
5participate in the Program within the timeline set by the
6Board after the Program opens for enrollment.
7 (b) Employers shall automatically enroll in the Program
8each of their employees who has not opted out of participation
9in the Program in the manner using the form described in
10subsection (c) of Section 55 of this Act and shall provide
11payroll deduction retirement savings arrangements for such
12employees and deposit, on behalf of such employees, these
13funds into the Program. Small employers may, but are not
14required to, provide payroll deduction retirement savings
15arrangements for each employee who elects to participate in
16the Program. Utilization of automatic enrollment by small
17employers may be allowed only if it does not create employer
18liability under the federal Employee Retirement Income
19Security Act.
20 (c) Enrollees shall have the ability to select a
21contribution level into the Fund. This level may be expressed
22as a percentage of wages or as a dollar amount up to the
23deductible amount for the enrollee's taxable year under
24Section 219(b)(1)(A) of the Internal Revenue Code. Enrollees
25may change their contribution level at any time, subject to
26rules promulgated by the Board. If an enrollee fails to select

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1a contribution level using the form described in subsection
2(c) of Section 55 of this Act, then he or she shall contribute
3the default contribution rate of his or her wages to the
4Program, provided that such contributions shall not cause the
5enrollee's total contributions to IRAs for the year to exceed
6the deductible amount for the enrollee's taxable year under
7Section 219(b)(1)(A) of the Internal Revenue Code.
8 (d) Enrollees may select an investment option from the
9permitted investment options listed in Section 45 of this Act.
10Enrollees may change their investment option at any time,
11subject to rules promulgated by the Board. In the event that an
12enrollee fails to select an investment option, that enrollee
13shall be placed in the investment option selected by the Board
14as the default under subsection (c) of Section 45 of this Act.
15If the Board has not selected a default investment option
16under subsection (c) of Section 45 of this Act, then an
17enrollee who fails to select an investment option shall be
18placed in the life-cycle fund investment option.
19 (e) Following initial implementation of the Program
20pursuant to this Section, at least once every year,
21participating employers may shall designate an open enrollment
22period during which employees who previously opted out of the
23Program may enroll in the Program.
24 (f) (Blank). An employee who opts out of the Program who
25subsequently wants to participate through the participating
26employer's payroll deposit retirement savings arrangement may

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1only enroll during the participating employer's designated
2open enrollment period or if permitted by the participating
3employer at an earlier time.
4 (g) Employers shall retain the option at all times to set
5up a qualified retirement plan, including, but not limited to,
6any type of employer-sponsored retirement plan, such as a
7defined benefit plan or a 401(k), a Simplified Employee
8Pension (SEP) plan, or a Savings Incentive Match Plan for
9Employees (SIMPLE) plan, or to offer an automatic enrollment
10payroll deduction IRA, instead of facilitating their
11employees' having a payroll deposit retirement savings
12arrangement to allow employee participation in the Program.
13 (h) An employee may terminate his or her participation in
14the Program at any time in a manner prescribed by the Board.
15 (i) The Board shall establish and maintain an Internet
16website designed to assist employers in identifying private
17sector providers of retirement arrangements that can be set up
18by the employer rather than allowing employee participation in
19the Program under this Act; however, the Board shall only
20establish and maintain an Internet website under this
21subsection if there is sufficient interest in such an Internet
22website by private sector providers and if the private sector
23providers furnish the funding necessary to establish and
24maintain the Internet website. The Board must provide public
25notice of the availability of and the process for inclusion on
26the Internet website before it becomes publicly available.

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1This Internet website must be available to the public before
2the Board opens the Program for enrollment, and the Internet
3website address must be included on any Internet website
4posting or other materials regarding the Program offered to
5the public by the Board.
6(Source: P.A. 102-179, eff. 1-1-22.)
7 (820 ILCS 80/85)
8 Sec. 85. Penalties.
9 (a) An employer who fails without reasonable cause to
10enroll an employee in the Program within the time prescribed
11under Section 60 of this Act shall be subject to a penalty
12equal to:
13 (1) $250 per employee for the first calendar year the
14 employer is noncompliant; or
15 (2) $500 per employee for each subsequent calendar
16 year the employer is noncompliant; noncompliance does not
17 need to be consecutive to qualify for the $500 penalty.
18 The Department shall determine total employee count using
19the annual average from employer-reported quarterly data.
20 (b) After determining that an employer is subject to a
21penalty under this Section for a calendar year, the Department
22shall issue a notice of proposed assessment to such employer,
23stating the number of employees for which the penalty is
24proposed under item (1) of subsection (a) of this Section or
25the number of employees for which the penalty is proposed

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1under item (2) of subsection (a) of this Section for such
2calendar year, and the total amount of penalties proposed.
3 Upon the expiration of 120 days after the date on which a
4notice of proposed assessment was issued, the penalties
5specified therein shall be deemed assessed, unless the
6employer had filed a protest with the Department under
7subsection (c) of this Section or come into full compliance
8with the Program as required under Section 60 of this Act.
9 If, within 120 days after the date on which it was issued,
10a protest of a notice of proposed assessment is filed under
11subsection (c) of this Section, the penalties specified
12therein shall be deemed assessed upon the date when the
13decision of the Department with respect to the protest becomes
14final.
15 (c) A written protest against the proposed assessment
16shall be filed with the Department in such form as the
17Department may by rule prescribe, setting forth the grounds on
18which such protest is based. If such a protest is filed within
19120 days after the date the notice of proposed assessment is
20issued, the Department shall reconsider the proposed
21assessment and shall grant the employer a hearing. As soon as
22practicable after such reconsideration and hearing, the
23Department shall issue a notice of decision to the employer,
24setting forth the Department's findings of fact and the basis
25of decision. The decision of the Department shall become
26final:

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1 (1) if no action for review of the decision is
2 commenced under the Administrative Review Law, on the date
3 on which the time for commencement of such review has
4 expired; or
5 (2) if a timely action for review of the decision is
6 commenced under the Administrative Review Law, on the date
7 all proceedings in court for the review of such assessment
8 have terminated or the time for the taking thereof has
9 expired without such proceedings being instituted.
10 (d) As soon as practicable after the penalties specified
11in a notice of proposed assessment are deemed assessed, the
12Department shall give notice to the employer liable for any
13unpaid portion of such assessment, stating the amount due and
14demanding payment. If an employer neglects or refuses to pay
15the entire liability shown on the notice and demand within 10
16days after the notice and demand is issued, the unpaid amount
17of the liability shall be a lien in favor of the State of
18Illinois upon all property and rights to property, whether
19real or personal, belonging to the employer, and the
20provisions in the Illinois Income Tax Act regarding liens,
21levies and collection actions with regard to assessed and
22unpaid liabilities under that Act, including the periods for
23taking any action, shall apply.
24 (e) An employer who has overpaid a penalty assessed under
25this Section may file a claim for refund with the Department. A
26claim shall be in writing in such form as the Department may by

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1rule prescribe and shall state the specific grounds upon which
2it is founded. As soon as practicable after a claim for refund
3is filed, the Department shall examine it and either issue a
4refund or issue a notice of denial. If such a protest is filed,
5the Department shall reconsider the denial and grant the
6employer a hearing. As soon as practicable after such
7reconsideration and hearing, the Department shall issue a
8notice of decision to the employer. The notice shall set forth
9briefly the Department's findings of fact and the basis of
10decision in each case decided in whole or in part adversely to
11the employer. A denial of a claim for refund becomes final 120
12days after the date of issuance of the notice of the denial
13except for such amounts denied as to which the employer has
14filed a protest with the Department. If a protest has been
15timely filed, the decision of the Department shall become
16final:
17 (1) if no action for review of the decision is
18 commenced under the Administrative Review Law, on the date
19 on which the time for commencement of such review has
20 expired; or
21 (2) if a timely action for review of the decision is
22 commenced under the Administrative Review Law, on the date
23 all proceedings in court for the review of such assessment
24 have terminated or the time for the taking thereof has
25 expired without such proceedings being instituted.
26 (f) No notice of proposed assessment may be issued with

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1respect to a calendar year after June 30 of the fourth
2subsequent calendar year. No claim for refund may be filed
3more than 1 year after the date of payment of the amount to be
4refunded.
5 (g) The provisions of the Administrative Review Law and
6the rules adopted pursuant to it shall apply to and govern all
7proceedings for the judicial review of final decisions of the
8Department in response to a protest filed by the employer
9under subsections (c) and (e) of this Section. Final decisions
10of the Department shall constitute "administrative decisions"
11as defined in Section 3-101 of the Code of Civil Procedure. The
12Department may adopt any rules necessary to carry out its
13duties pursuant to this Section.
14 (h) Whenever notice is required by this Section, it may be
15given or issued by mailing it by first-class mail addressed to
16the person concerned at his or her last known address or in an
17electronic format as determined by the Department.
18 (i) All books and records and other papers and documents
19relevant to the determination of any penalty due under this
20Section shall, at all times during business hours of the day,
21be subject to inspection by the Department or its duly
22authorized agents and employees.
23 (j) The Department may require employers to report
24information relevant to their compliance with this Act on
25returns otherwise due from the employers under Section 704A of
26the Illinois Income Tax Act and failure to provide the

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1requested information on a return shall cause such return to
2be treated as unprocessable.
3 (k) For purposes of any provision of State law allowing
4the Department or any other agency of this State to offset an
5amount owed to a taxpayer against a tax liability of that
6taxpayer or allowing the Department to offset an overpayment
7of tax against any liability owed to the State, a penalty
8assessed under this Section shall be deemed to be a tax
9liability of the employer and any refund due to an employer
10shall be deemed to be an overpayment of tax of the employer.
11 (l) Except as provided in this subsection, all information
12received by the Department from returns filed by an employer
13or from any investigation conducted under the provisions of
14this Act shall be confidential, except for official purposes
15within the Department or pursuant to official procedures for
16collection of penalties assessed under this Act. Nothing
17contained in this subsection shall prevent the Director from
18publishing or making available to the public reasonable
19statistics concerning the operation of this Act wherein the
20contents of returns are grouped into aggregates in such a way
21that the specific information of any employer shall not be
22disclosed. Nothing contained in this subsection shall prevent
23the Director from divulging information to an authorized
24representative of the employer or to any person pursuant to a
25request or authorization made by the employer or by an
26authorized representative of the employer.

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