IRS Releases Preliminary Data on 401(K) Plans

Back in mid-January, the IRS released data from their 401(k) plan questionnaire which was sent to 1,200 people in 2009 and 2010. According to the results, which were presented at a Los Angeles Benefits Conference hosted by the American Society for Pension Professional and Actuaries, only a tiny percentage of plans allow participants to invest in company stock. To be specific, according to the questionnaire – about 1% of plans allow investments in employer securities. Final results from the questionnaire will be released later in 2012.

“The use of company stock as an investment option for employee investments in a 401(k) is rare in over 95% of U.S. companies that are not traded publicly. Public companies aside, only a small percentage of businesses in the U.S., or any other nation for that matter, offer company stock as an option, but even this number has declined since the sagas of Enron, WorldCom, and the many stock drop cases. The IRS data is not surprising,” said ESOP Association President J. Michael Keeling.