SECURE 2.0’s new education and student loan benefits went into effect in 2024, which gives employers new opportunities to support their employees. Employers can now match student loan repayments in conjunction with their retirement plans, and employees can roll over 529 Education Savings Plans into Roth IRA savings accounts.
Student Loan Repayment Matching
Under SECURE 2.0, employers of any size can now offer a student loan repayment matching program with their company 401(k), 403(b), or SIMPLE IRA plan. This matching employer payment promotes student loan repayment by employees and allows them to save for retirement while still paying down their loans. The student loan repayment matching program is voluntary for employers, and employees may lose the matching program if they change employers.
529 Rollovers
The second change that SECURE 2.0 makes effective in 2024 affects 529 Education Savings Plans. Individuals with 529 plans can now roll over unused higher education funds from those plans tax-free into Roth IRAs. The 529 plan must have been open for over 15 years, with a lifetime cap of $35,000, for the plan’s owner to qualify for this relief. This benefit offers an opportunity for tax-free withdrawals that previously did not exist for individuals who overfunded their 529 plans to save for higher education costs. All withdrawals from 529 plans are subject to the annual limits on Roth IRA contributions.
HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 678-439-6236.
Hall Benefits Law, LLC
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