As an accountant, you play an essential role in helping your clients achieve important short and long-term financial goals. One of those goals may be planning for retirement.
Your experience and confidence in the complex world of retirement planning might vary. But, whether you're a retirement novice or a seasoned expert, your clients may ask you to help guide them through setting up — and even managing — a 401(k). In fact, according to our research, 80% of financial and benefits professionals say they have advised their clients on offering a 401(k), of which nearly 60% say their clients asked them for retirement advice.¹ Where do you land?
Offering retirement plans to your clients can be a great way to grow your business and boost your reputation as a respected advisor. In this post, we'll explain everything you need to know to confidently help your clients offer a 401(k).
Let's get started.
Why your clients care about 401(k) plans
There are a few reasons why your clients may be eager to offer retirement benefits to their teams, including:
1. There are tax advantages for offering retirement benefits
More than two-thirds of benefits decision-makers who don't offer a retirement plan said they believe offering a 401(k) is cost-prohibitive. However, thanks to tax credits established under the SECURE 2.0 Act, offering a retirement benefit can be easier and more affordable than ever before.
In fact, if your client is offering their first 401(k), they may be eligible for up to $16,500 in tax credits that could cover 100% of the cost for the plan's first three years. You can learn more about the SECURE 2.0 retirement plan tax credits and calculate your client's potential costs on our blog.²
And don't forget — employer contributions are generally 100% tax deductible on an employer's federal income tax return.
2. Keep your clients compliant with retirement state mandates
Currently, multiple states have active mandated programs that require businesses to offer a retirement benefit, and many others have introduced or passed legislation to implement state-mandated retirement programs. While the rules of these programs can vary from state to state, there are consequences for businesses that fail to comply, including hefty fines and legal consequences. By helping your clients offer a qualified 401(k) plan, you can help them meet the mandate and reap the benefits we outlined above.³
3. 401(k) plans can help your clients attract and retain top talent
While retirement plans can help employees save for their futures, there are also many benefits for businesses that offer a 401(k) — and the proof is in the pudding. Research shows that a retirement benefit like a 401(k) can be a powerful tool to help your clients attract new talent, keep their teams happy, and may even help with retention.
Your role in designing and implementing a 401(k) plan
Long story short — the role you might play in helping your clients with a 401(k) can vary depending on your client's wants and needs and whether or not you serve as a fiduciary on the plan.
Here's a look at some of the ways you may be asked to support your clients' retirement benefits:
Building and customizing a plan
Businesses of all sizes can set up a 401(k) plan. When designing a 401(k), your client can customize their plan with several types of provisions. These include, but aren't limited to:
A traditional 401(k) is a standard plan that can offer the most flexibility in plan design for your clients. This especially comes into play when deciding how much in employer contributions (if any at all) they'd like to offer. With flexibility comes more responsibility so that a plan will pass or corrects non-discrimination tests. Note that failing these tests could result in your clients incurring unexpected expenses to make the plan compliant.
A Safe Harbor 401(k) plan can be a great solution for clients who want to play it safe with compliance. These plans come with built-in protections that automatically satisfy most IRS nondiscrimination tests.⁴ However, your clients must contribute to their employees' 401(k) plans in exchange for these protections.
Starter 401(k) plans help employers offer a retirement benefit by streamlining two of the most significant barriers when it comes to offering retirement savings plans: cost and ease of administration. These plans have fewer restrictions on employee participation, eliminating the need for nondiscrimination testing. But note that with a Starter plan, your clients won't be able to contribute to their employees' savings and the amount your employees can contribute is also much less, resulting in lower overall contribution limits.
As you're helping your clients choose a 401(k) plan that supports their goals, you should consider the following factors:
Can your client's business afford to offer a 401(k) match? Offering a 401(k) match can help your clients keep their employees happy and engaged. The numbers don't lie — 401(k) matching ranks as the #2 most desired job benefit among employees, second only to fully paid health-care premiums.
Is your client looking for a plan that automatically satisfies IRS requirements? Offering a 401(k) can feel overwhelming from a compliance perspective. If this rings true for your client, you may want to suggest a Safe Harbor 401(k), which generally satisfies IRS nondiscrimination tests.⁴ Smaller companies may also consider a Starter 401(k), which satisfies nondiscrimination tests but has more plan limitations.
Does your client want to offer profit sharing? Profit sharing is a pre-tax contribution your clients can make to their employees' 401(k) accounts at the end of the year. It's a way for businesses to offer an end of year bonus directly into their employees' retirement account, which offers tax advantages for both parties. If this benefit sounds advantageous to your client, you may want to avoid recommending a Starter 401(k), which doesn't allow for employer contributions.
Plan administration and compliance
On a day-to-day basis, your client may ask you to monitor 401(k) contributions and account balances. But they may also ask that you monitor to ensure their plan is compliant with IRS regulations and requirements, as well as making sure the plan meets legal standards and avoids penalties.
Keeping 401(k) plans compliant can feel like one of the most important and challenging aspects of managing a retirement benefit. If your client offers their team a 401(k), they'll need to file and submit Form 5500 each tax season. Learn more about these responsibilities below:
Answering client questions and providing support
Whether this is your client's first or fifteenth time offering a 401(k), they'll likely have questions for you. If the ins and outs of retirement benefits are new to you, don't worry. There are many resources and programs you can leverage to help you set your clients up for success.
Help your clients offer a modern 401(k) with Gusto Pro
Gusto Pro is a free platform we created to make it simple for accountants and benefits professionals to offer 401(k) plans to their clients. By offering retirement benefits, you can grow your own accounting business and strengthen your offering as a service provider. The program costs nothing and features many tools, support, and perks, including:
Keep all your clients' plans in one place: The Gusto Pro dashboard makes it easy to set up, track, and manage all your clients' 401(k) plans.
Affordable plan pricing: Your clients won't have to pay extra for plan setup, plan transfers, or 5500 prep.⁵
Stay in compliance: You and your clients can rest easy knowing that we work to keep our plans compliant with year-round compliance testing monitoring.⁶
Access to a dedicated partner manager: As a Gusto Pro partner, you'll be matched with a dedicated partner manager who can answer you and your clients' questions and help you navigate any outstanding tasks. From understanding your dashboard to managing your plan details, we're your partner throughout every step of the 401(k) process.
Pass on plan discounts to your clients: Gusto Pro partners can pass on meaningful savings to their clients year-round. For example, we'll give 3 months of no employer fees for each client you sign up and we'll waive 6 months of employer fees for your firm's own Gusto 401(k).⁷
Reap the benefits of referral rewards: As a Gusto Pro partner, you can earn $500+ for each new 401(k) you add.⁸
Stay updated: It can be challenging keeping up with the ever-changing retirement industry. But as a Gusto Pro partner, we'll always keep you in the know and provide education about everything from the latest on state mandates to the SECURE Act and beyond.
FAQs
How can accountants help clients with 401(k) plans?
Accountants can assist clients by helping them design and customize 401(k) plans, maintaining compliance with IRS regulations, monitoring contributions, filing Form 5500, and answering questions about retirement benefits. They can also help clients choose between traditional, Safe Harbor, or Starter 401(k) plans based on their specific needs and budget.
What tax benefits are available for businesses starting a 401(k)?
Businesses starting their first 401(k) may be eligible for up to $16,500 in tax credits over the first three years under the SECURE 2.0 Act.² Additionally, employer contributions are generally 100% tax deductible on federal income tax returns, and administrative expenses may also be deductible.²
What is a Safe Harbor 401(k) plan?
A Safe Harbor 401(k) plan comes with built-in protections that automatically satisfy most IRS nondiscrimination tests.⁴ In exchange for these compliance benefits, employers must make contributions to their employees' 401(k) accounts. This is a good option for clients who want to minimize compliance concerns.
What is Gusto Pro?
Gusto Pro is a free platform for accountants and benefits professionals to offer 401(k) plans to their clients. It includes tools for managing multiple client plans, affordable pricing with low fees, year-round compliance testing, dedicated relationship managers, and referral rewards for eligible plan referrals.
Disclaimers
¹ Source: Gusto research run with Suzy. Insights based on data collected December 2023 through January 2024, from a survey of 474 US-based financial and benefits professionals. Gusto was not identified as the survey sponsor. The experiences of the respondents in this survey may not be representative of all people.
² This content is for informational purposes only and is not intended to be taken as tax advice. Please consult a tax professional to determine what types of tax credits or deductions your company is eligible to claim.
³ As of March 2026. This information is general in nature and is for informational purposes only. It should not be used as a substitute for specific tax, legal and/or financial advice that considers all relevant facts and circumstances. Deadlines, fees, and other program details are subject to change by the state without notice and should be checked prior to making any decisions.
⁴ In general, Safe Harbor 401(k) plans automatically satisfy Top Heavy requirements. One exception is for plan years in which the employer makes discretionary contributions (such as profit sharing contributions) in addition to Safe Harbor contributions. Removing Safe Harbor contributions mid-year will also require plans be subject to all compliance testing. All plans of related entities must be administered by Gusto Retirement Services, LLC in order for us to provide compliance testing.
⁵ Third-party auditor fees will apply to large plans where an audit is required. These fees are not charged or covered by Gusto.
⁶ All plans of related entities must be administered by Gusto Retirement Services, LLC in order for us to provide compliance testing.
⁷ Fees included in this promotion are the monthly base fee charged to the 401(k) plan sponsor and the monthly active participant fee. Fees paid for payroll services are not included in this promotion. Other employer-paid service fees are not included in this promotion. Participant-paid fees are not included in this promotion and will still apply. See here for more information regarding Gusto fees. Not every 401(k) tier may be included in this promotion. This offer ends June 1, 2026 and can't be combined with other offers. Flexible pricing opportunities may affect this promotion. Contact Sales at [email protected] for further details. Gusto reserves the right to modify or discontinue this promotion at any time without prior notice.
⁸ A new Gusto 401(k) plan invited through your dashboard, provided that you do not act as a fiduciary for the plan, is eligible for referral payment. This referral is of products and services of Gusto Retirement Services, LLC only and does not apply to any products or services of Gusto Investment Services, LLC.
