What tax breaks are available to employers for providing retirement counseling for employees?

Employers that sponsor qualified retirement plans can provide qualified retirement planning services to employees and their spouses as a tax-free benefit.

Qualified retirement planning services. Qualified retirement planning services that may be excluded from income and wages by an employee and his or her spouse include any retirement planning advice or information provided by the employer maintaining a qualified plan (that is, a retirement plan eligible for certain tax breaks-see, ¶47,230 ). The income exclusion is not limited to information regarding the qualified plan itself. For example, the exclusion would apply to advice that was provided to an individual and his or her spouse regarding retirement income planning and information illustrating application of the employer's plan to the individual's overall retirement income plan. However, it appears that services that may be related to retirement planning, such as tax preparation, counting, legal, or brokerage services, may not be excluded from an employee's income under this provision.

Employees can receive an income tax exclusion for employees for the value of retirement planning services. However, this provision does not provide a shield for employers from fiduciary liability that may arise out of the retirement planning services.

Nondiscrimination rules. Highly paid employees may exclude the value of employer-provided retirement planning services from income. However, for highly paid employees to qualify for this exclusion, the retirement planning services must be available on substantially the same terms to each member of the group of employees that is normally provided education and information regarding the employer's qualified plan.