These frequently asked questions and answers provide general information and should not be cited as legal authority. They provide the user with information responsive to general inquiries but the answers do not apply to every situation and yours may require additional research.

Automatic contribution arrangements (ACAs), also referred to as automatic enrollment arrangements, may be used in a variety of employer plans and programs. However, these FAQs only address ACAs for employer retirement plans. We based our answers on the Final Regulations on Automatic Contribution Arrangements, issued on February 24, 2009.

1. What is an automatic contribution arrangement (ACA) in a retirement plan?
2. What are the benefits of an ACA in a retirement plan?
3. Are there different types of ACAs for retirement plans?
4. Can an employer add an ACA to its existing retirement plan?
5. What kind of an eligible automatic contribution arrangement (EACA) or a qualified automatic contribution arrangement (QACA) notice does an employer have to provide to employees?
6. When must an employer provide notice of the retirement plan’s ACA to an employee?
7. When can an employer begin deducting automatic enrollment contributions to the retirement plan from an employee’s wages?
8. Can an employee elect not to participate in the retirement plan’s ACA?
9. Can an employee’s election not to participate in the retirement plan’s ACA expire?
10. How can an employee elect not to participate in the retirement plan’s ACA?
11. What happens when an employee elects not to participate in the retirement plan’s ACA?
12. If an employee elects not to participate in the retirement plan’s ACA in a subsequent year, what happens to his or her previous automatic enrollment contributions?
13. Can an employee withdraw any automatic enrollment contributions from the retirement plan?
14. Can an employee elect to contribute a different amount than the plan’s default percentage rate for automatic enrollment contributions to the retirement plan?
15. Is an employer who uses an ACA in its retirement plan required to contribute to an employee’s retirement account?
16. How does an employer report an employee’s automatic enrollment contributions to a retirement plan?
17. How does an employer report automatic enrollment contributions withdrawn from the retirement plan by an employee?