Employer requirements
Register with MarylandSaves and facilitate payroll deductions, or certify that you offer a qualified retirement plan.
Active mandate
Maryland Retirement Plan Mandate: Requirements for Employers
MarylandSaves
MarylandSaves covers employers in operation 2+ calendar years with at least one W-2 employee over 18 that use an automated payroll system and do not offer a qualified plan. There is no monetary penalty — Maryland instead waives the $300 SDAT annual report filing fee for participating employers.
The Program
How the MarylandSaves program works
MarylandSaves is the state-facilitated retirement savings program for Maryland employers that do not sponsor a qualified retirement plan. It is a mandate — but it is the only program in the country reviewed by LRS that carries no monetary penalty for non-compliance.
Coverage turns on an unusual test. A Maryland employer is covered if it has been in operation for two or more calendar years, has at least one W-2 employee over the age of 18, uses an automated payroll system, and does not already offer a qualified plan. That payroll-system condition is specific to Maryland: an otherwise-covered business that does not run automated payroll falls outside the program.
The registration deadline of December 31, 2024 has passed. Rather than fining employers who ignore it, Maryland uses an incentive — participating employers receive a $300 annual benefit through a waiver of the SDAT annual report filing fee. Sponsoring a qualified plan such as a 401(k) exempts you from the program entirely, and for many Maryland employers that plan is the better long-term answer: the state program is a Roth IRA that does not permit employer contributions.
At A Glance
The Maryland mandate at a glance
Registration deadlines
The registration deadline of December 31, 2024 has passed.
Covered employers
Employers in operation 2+ calendar years with at least one W-2 employee over 18, using an automated payroll system, that do not offer a qualified plan.
Penalties / enforcement
No monetary penalty. Maryland uses an incentive instead: participating employers receive a $300 annual benefit via waiver of the SDAT annual report filing fee.
The Requirements
Who must comply in Maryland — and what is required
Employee eligibility
W-2 employees over 18 are eligible; enrollment is automatic with an opt-out, administered through MarylandSaves.
Exemptions
Employers sponsoring a qualified plan; employers not using automated payroll; businesses under 2 years old.
Penalties and enforcement
No monetary penalty. Maryland uses an incentive instead: participating employers receive a $300 annual benefit via waiver of the SDAT annual report filing fee.
Your Options
Qualifying retirement plan alternatives in Maryland
Employers sponsoring a qualified retirement plan satisfy the MarylandSaves requirement — and still qualify for the SDAT fee waiver by certifying.
Start a new 401(k)
Design a plan around your workforce — matching, Roth options, vesting, and federal startup tax credits.
Start a new planUpgrade an existing plan
Confirm your current plan qualifies, then tune its design so the mandate works in your favor.
Upgrade my company’s planFull plan administration
LRS handles compliance testing, filings, and day-to-day administration so the plan stays qualified.
Plan administration servicesRead more about state-approved qualifying retirement plans.
Common Questions
Maryland mandate FAQs
Is MarylandSaves mandatory?
Yes, for covered employers. A Maryland employer is covered if it has been in operation two or more calendar years, has at least one W-2 employee over 18, uses an automated payroll system, and does not offer a qualified retirement plan.
What is the penalty for not registering with MarylandSaves?
There is no monetary penalty. Maryland is the only state program in the LRS review that uses an incentive instead: participating employers receive a $300 annual benefit through a waiver of the SDAT annual report filing fee.
Does my business have to use automated payroll to be covered?
Yes. The automated payroll system condition is part of Maryland's coverage test. An employer that does not use automated payroll is not covered by MarylandSaves, even if it meets the other conditions.
We have a 401(k). Do we need to do anything?
Employers sponsoring a qualified retirement plan are exempt from MarylandSaves. Keep documentation of that exemption with your plan records.
What is the MarylandSaves deadline?
The registration deadline was December 31, 2024. A covered employer that has not registered or certified an exemption still needs to do so u2014 Maryland carries no monetary penalty, but participating employers receive the $300 annual SDAT filing-fee waiver.
Can we contribute to our employees' MarylandSaves accounts?
No. MarylandSaves is a Roth IRA with auto-enrollment at 5% and auto-escalation; employers facilitate payroll deductions but do not contribute. An employer-sponsored plan is the route to matching and higher contribution limits.
Talk It Through
Not sure how the Maryland mandate applies to you?
Leading Retirement Solutions designs and administers plans that satisfy state mandates. Talk through your requirements with a consultant before your deadline.
This page is provided for general information only and is not legal or tax advice. Program details change; confirm requirements with the official state program or your advisors.