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Subject:  Opt-in to opt-out on 401(k)? Date:  8/5/2001  2:23 PM
Author:  frog6 Number:  53081 of 127747

Albert Crenshaw mentioned in his column today ( that "...some employers are turning to automatic enrollment, which is allowed under tax rules issued in the past few years. Instead of leaving out new workers unless they opt in, these companies are enrolling new workers unless they opt out."

Can anyone point me to where these "new tax rules" would be listed? I looked through the IRS site and found general info on 401(k) plans (, for example), but nothing that showed the law/regulation behind it.

Reason I'm interested: in the military we're starting the Thrift Savings Plan this fall, which is a limited version of a non-matching 401(k). When I brought up the possibility of making the TSP "opt-out" for our young enlistees (and officer candidates, for that matter) at a senior officer financial leadership seminar last summer, it was rejected because of questionable legality, and I dropped the subject (my warfare specialty is about as far away from financial expertise as possible). If Mr. Crenshaw is correct, I'd like to resurrect the possibility for the TSP.

He also notes that one of the drawbacks to these "opt-out" programs is that often those individuals will never increase their contributions or alter their holdings. Another issue to be addressed, obviously, but I'd like to hit the "opt-out" one again prior to looking into that challenge.

Any help greatly appreciated in advance,

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