Title 26 — Internal Revenue CodeRelease 119-73

§45T Auto-enrollment Option for Retirement Savings Options Provided by Small Employers

Title 26 › Subtitle Subtitle A— Income Taxes › Chapter 1— NORMAL TAXES AND SURTAXES › Subchapter A— Determination of Tax Liability › Part IV— CREDITS AGAINST TAX › Subpart D— Business Related Credits › § 45T

Last updated Apr 6, 2026|Official source

Summary

Small employers can claim a $500 tax credit per year for adding automatic enrollment to their retirement plan. The credit runs for a 3-year period starting with the first taxable year the employer includes an eligible automatic contribution arrangement in a qualified plan it sponsors, and it is only allowed for years the arrangement stays in the plan. An eligible employer is defined by reference to section 408(p)(2)(C)(i).

Full Legal Text

Title 26, §45T

Internal Revenue Code — Source: USLM XML via OLRC

(a)For purposes of section 38, in the case of an eligible employer, the retirement auto-enrollment credit determined under this section for any taxable year is an amount equal to—

(1)$500 for any taxable year occurring during the credit period, and

(2)zero for any other taxable year.

(b)For purposes of subsection (a)—

(1)The credit period with respect to any eligible employer is the 3-taxable-year period beginning with the first taxable year for which the employer includes an eligible automatic contribution arrangement (as defined in section 414(w)(3)) in a qualified employer plan (as defined in section 4972(d)) sponsored by the employer.

(2)No taxable year with respect to an employer shall be treated as occurring within the credit period unless the arrangement described in paragraph (1) is included in the plan for such year.

(c)For purposes of this section, the term “eligible employer” has the meaning given such term in section 408(p)(2)(C)(i).

Legislative History

Notes & Related Subsidiaries

Statutory Notes and Related Subsidiaries

Effective Date

Section applicable to taxable years beginning after Dec. 31, 2019, see section 105(d) of Pub. L. 116–94, set out as an

Effective Date

of 2019 Amendment note under section 38 of this title.

Reference

Citations & Metadata

Citation

26 U.S.C. § 45T

Title 26 — Internal Revenue Code

Last Updated

Apr 6, 2026

Release point: 119-73