3798.1 / What rules govern the pension-linked emergency savings accounts (PLESAs) created by the SECURE Act 2.0?

Non-highly compensated employees may be entitled to contribute the lesser of (1) 3% of compensation or (2) $2,500 to pension-linked emergency savings accounts (PLESAs) using after-tax dollars if their employer elects to establish a PLESA.

Initial IRS guidance¹ addresses the anti-abuse rules under IRC Section 402A(e)(12). The IRS notes that PLESAs are optional, and plans may stop offering a PLESA option at any time.

PLESAs are treated as Roth accounts (i.e., contributions are made with after-tax dollars and the contributions themselves are not taxable when withdrawn). Participants must be permitted to make withdrawals at least once a month.