eTrade announcement and Super/Mega Roth

[Pixel Rogue]

Received an email today from eTrade requiring changes to be made to their 401k program. 

eTrade is no longer supporting after-tax (nom-deductible) contributions to 401k plans (aka closed the door on roth conversion and the  mega/super roth opportunities.)  The message is basic and learned of these changes in the call….we must change our plan and select the option to NOT allow after tax contribution.

This is a major blow. eTrade had zero additional information to share. No thresholds, options - cold stop. 

What other brokers allow for small companies to set up self-directed retirement plans that would support after-tax contributions and convert to roth? 

Thoughts? 

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If you have not restated your plan, we would like to take this time to remind you about the requirement to restate your qualified retirement plan documents at E*TRADE. If this process is not completed by the deadline, you will be at risk of losing the tax-qualified status of your qualified plan. Read on to learn what`s required of you—and if you need paper copies of any forms or documents sent by mail, call us at the number below. Please note: If you have already restated your plan but have yet to return the required Restatement Certification Form to E*TRADE, please review this notification of restatement changes and return your Restatement Certification Form for our records. PLAN RESTATEMENT DETAILS Restate your plan by July 31, 2022 to keep it current with the latest rules and regulations. Restatement is required by law for all qualified plans. Because it`s been six years since the last restatement requirement, the IRS requires that you amend your plan documents to bring them into compliance with all the latest regulations, including any changes to IRS plan rules. You can learn more about the changes by reading this IRS summary. To restate your plan in accordance with IRS regulations, complete the steps described in your restatement instructions by July 31, 2022. If your documents are not updated by this date, your plan will be at risk of losing its tax-qualified status. Subject to IRS guidelines, the restatement period may be an opportunity to add or revise provisions to your plan, such as eligibility, vesting, and new safe harbor rules. A few things to keep in mind: If you have more than one plan (e.g., Individual 401(k) and Profit-Sharing Plan), be sure to complete the instructions for each. Restatement must be completed by the plan sponsor (employer). If you are not self-employed or the plan sponsor, please forward this email to your employer. Restatement requirements are set by the IRS, not by E*TRADE or its affiliates. If you are receiving this notice for the first time, you are part of a small population of newly opened plans that will need to complete restatement due to the timing of application updates. If you are receiving this notice after already completing your Plan Restatement Certification Form, please disregard. If your Plan Restatement Certification Form was rejected, please address all rejection reasons and resubmit the form so we can record completion of your restatement. Have questions? Call a Small Business Plan Specialist at 888-402-0654 from 7 a.m. to 8 p.m. ET, weekdays. We`re here to help.