Nevada retirement plan mandate: What employers need to know

Does your business need to participate in Nevada NEST?

There are two quick criteria to see if your business must participate in NEST. First, do you have six or more employees? Second, have you been in business for at least 36 months? A business must join the program if it answers “yes” to both questions.

 

However, if your business already offers a qualified retirement plan, you’re exempt from NEST. This includes companies that offer their employees any of the following:

• 401(a) – Including a 401(k)
• 403(a) – Qualified annuity plan
• 403(b) – Tax-sheltered annuity plan
• 408(k) – Simplified Employee Pension plan
• 408(p) – SIMPLE IRA plan
• 457(b) – Governmental deferred compensation plan

 

Note that even if your business is exempt from the program, you still need to file paperwork with the state to register for that exemption. If you ignore NEST, you could eventually face fines, even with a valid exemption.

 

Businesses that offer retirement benefits can also qualify for an exemption through a chamber of commerce or trade association. The plan needs to meet the requirement of being “tax-favored.”

 

If your company hasn’t yet hit the 36-month mark, you don’t have to worry about the Nevada state-mandated retirement plan until it does. Just be mindful that it’s something you’ll need to deal with when the time comes.

 

To help you navigate the rules, we’ve summarized NEST’s core requirements in the table below.

 

Nevada NEST Mandate: Requirements at a glance

Requirement	Details
Employer eligibility	Businesses with six or more employees that have operated for at least 36 months.
Employee eligibility	Workers who are at least 18 years old, employed for at least 120 days, and compensated in Nevada.
Default contribution	5% after-tax Roth IRA deduction, which automatically increases by 1% annually unless the employee makes a change.
Qualified exemptions	Businesses offering existing tax-favored plans, including 401(a), 403(a), 403(b), 408(k) SEP, 408(p) SIMPLE, or 457(b) plans.
Initial deadline	September 1, 2025, for all existing eligible employers.

NEST employee eligibility and enrollment rules

Once you’ve registered your business for NEST, the next step is figuring out which employees are covered.

 

Who qualifies

Anyone is eligible who is at least 18 years old and has worked for your company for at least 120 days. The employees also must receive their compensation in the state of Nevada — this won’t apply to employees you may have in other states.

 

How do employees enroll

The enrollment process is automatic for qualifying workers. As the employer, you won’t have to open accounts or make contributions. Once you submit your employee roster to the NEST portal, the program automatically creates a Roth IRA for each eligible worker. The default contribution rate is 5% of wages, which automatically annually increases by 1% unless the employee chooses a different amount.

 

How employees contribute

These contributions come out of after-tax pay, as they are funding a Roth IRA. This impacts how the deduction appears on employees’ pay stubs, so it is worth communicating. Employees are free to choose from different investment options based on their risk tolerance, but the program has a single default fund for anyone who doesn’t make a selection.

 

The key takeaway for employers is that your role will be limited. You’re responsible for registering for the program, submitting employee information, and processing payroll deductions. But you don’t have to worry about setting up accounts, making financial contributions, or managing investments.

How to manage Nevada mandate deductions in payroll

Setting up NEST deductions is straightforward, but it does take upfront coordination. You’ll start by registering on the NEST portal and submitting your employee roster. Have the following information ready before attempting this:

• Your employer identification number (EIN)
• Bank information for remitting contributions
• Employee details, including names, birth dates, Social Security numbers, and contact information
• Your current payroll schedule

 

Once the state processes your registration, it automatically opens NEST accounts and enrolls eligible employees. This is where the payroll piece comes into play.

 

You’ll need to set up a post-tax deduction in your payroll system for each employee at the default 5% rate or whatever rate the employee chooses. The deductions come after taxes are calculated, so be sure to categorize them correctly.

 

Most payroll software can easily handle this type of deduction. But you may want to contact your provider directly to confirm whether they support NEST deductions and to get more information about setting them up in your software.

 

One thing to watch is keeping deductions up to date. If an employee changes their contribution rate or opts out, you’ll need to update payroll before their next check. NEST will communicate any changes you make directly to the employee, but it’s on you, the employer, to make sure the deductions in your payroll match.

 

Staying on top of these updates is easier when everything lives in one place. Integrated employee records, deduction changes, and compliance tasks can save you a headache down the line.

Handling employee opt-outs and account changes

NEST is an automatic enrollment program, but it’s not mandatory for employees. At any time, an enrolled worker can opt out of the program without penalty. After enrollment, there’s a 30-day notice window to withdraw before contributions begin. However, employees can leave the program after that as well.

 

When an employee opts out, the state handles communications on their end. Your only responsibility is to stop their payroll deduction. This requires clear processes for tracking who is in and out on your roster. You don’t want to be responsible for unwinding contributions that shouldn’t have gone through.

 

Beyond opting out, employees can also make various changes to their accounts, such as:

• Adjusting their contribution rate up or down
• Choosing different investment options
• Withdrawing from the account, subject to federal tax rules

 

It’s good practice to document every opt-out and every change to a contribution you process. This will give you a paper trail showing your payroll deductions matched each employee’s choices. If that’s ever questioned, you’ll be able to prove that you met your responsibilities.

Deadlines and penalties for noncompliance

The first key deadline was September 1, 2025. By then, all existing eligible employers in Nevada had to have registered or certified for their exemption. You should have received an access code from the state by email or mail if this deadline applied to your business.

 

If you are a newer company or one that meets one of the program’s criteria, then you should register soon. Nevada hasn’t published a specific penalty schedule for employers who miss their deadline. But noncompliance typically results in fines per employee.

 

For comparison’s sake, California’s CalSavers program can fine noncompliant employers $250 per eligible employee. If that violation isn’t resolved within 90 days, the fee increases to $500 per employee. The OregonSaves program follows a similar penalty structure.

 

The good news is registration is free, and the process is fairly quick. After registration, keep an eye on the program’s website for new enforcement details, such as specific fine amounts and timelines.

Next steps for Nevada small business owners

Whether you need to register for NEST or certify for an exemption, here’s a quick review of your next steps:

1. Determine whether your business meets the coverage criteria of six or more employees and at least 36 months of operations.
2. Check if your current retirement plan qualifies for an exemption, especially if you already offer a 401(k), 403(b), SEP IRA, or SIMPLE IRA.
3. Find your NEST access code, which should arrive by email or post.
4. Log in to the portal to register or certify for an exemption.
5. Coordinate with your payroll provider to set up post-tax deductions for enrolled employees.
6. Prepare employee information, including names, birth dates, SSNs, and contact details.
7. Communicate with your team about what NEST is, how it works, and how they can opt out at any time.

 

If you already offer a qualifying retirement plan, the only action item is certifying for your exemption. For employers who are enrolling, the process is a bit more complex, requiring ongoing payroll monitoring to avoid fines and keep deductions current.