When it is hard to find employees, dental practices that can bring something to the table that attracts – and retains – good team members will win the war for talent. Here’s something to consider: expand your retirement savings plan to match employee student loan payments. 

Based on the guidance provided in IRS Notice 2024-63, dental practices can help employees grow their retirement savings, even if those employees are currently prioritizing paying off student loans. This option applies to retirement plans years beginning after December 31, 2023, so you can implement it right away too. Here’s a closer look at what this means for dental practice employers and their teams: 

• New Matching Opportunities: Employers can now match qualifying student loan payments, allowing employees to benefit from retirement savings growth while managing their educational debt. This is a strategic move, especially for dental practices looking to retain younger staff who may be burdened by student loans.
• Certification Process: Employees will need to certify that their student loan payments qualify for these matching contributions. This ensures that the benefits are accurately distributed and that employees receive the retirement contributions they deserve.
• Flexible Plan Integration: The IRS guidance offers flexibility in how dental practices can integrate these matching contributions into their existing retirement plans. Employers can adopt procedures that fit within their unique plan structures, making the transition smoother.
• Nondiscrimination Testing Adjustments: To accommodate this new benefit, the IRS has provided special relief from certain nondiscrimination tests for 401(k) plans. This helps ensure that offering student loan matching contributions won’t lead to compliance challenges.

Why This Matters for Dental Practices

By implementing this new option, dental practices can strengthen their employee benefits package, particularly appealing to staff members who are managing student debt. This can improve employee satisfaction and retention, contributing to a more stable and committed workforce.

What Next?

Dental practice owners should consider how this new guidance could enhance their retirement plan offerings. If you’re interested in exploring how to implement these changes in your practice – even if you aren’t currently a client – don’t hesitate to reach out for expert advice tailored to your specific needs. We can help ensure your plan is compliant and optimized for both your practice and employees.