The rollover program includes access to IRA services of E*TRADE Securities LLC, according to a news release.
The Mandatory Rollover program will provide plan sponsors with a system to service the mandatory small balance distributions and to facilitate the transfer of participant accounts that are greater than $1,000, but not in excess of $5,000 to IRAs. Through the program, ADP will work with plan sponsors and fiduciaries to amend plan documents and automate mailings to notify participants of automatic distribution procedures and new IRA account openings in compliance with safe harbor regulations, according to the news release.
“Our plan sponsors are looking to ADP for solutions that help them address the new regulations and safe harbor provisions,” said Kendall Kay, Vice President, Marketing, Strategic Planning and Business Development, ADP Retirement Services, in the news release. “However, their biggest challenges are to identify a qualified IRA provider interested in accounts of this size and to manage associated fees.”
The new offering comes as the new automatic rollover rules are scheduled to go into effect. Come March 28, plans with mandatory distribution provisions will have to have something in place to deal with distributions of more than $1,000 for which distribution instructions aren’t provided (See IRS, Treasury Issue Automatic Rollover Guidance ).
WMSI’s the Rollover Solutions Network (RSN) provides for the ongoing reporting of distribution and rollover activity and can automate strategic marketing campaigns designed to raise awareness of rollover services and influence participant distribution behavior. WMSI has signed agreements during the past year with Ameritrade , E*Trade , T. Rowe Price , ExpertPlan , and Merrill Lynch , and first launched the service with BISYS last January.