isolved NEW RELEASE

In this release:

• Benefits/HR: Secure Act 2.0 Updates – Roth Catch-up for Highly Paid Individuals (HPIS)
• Identity: Self-Service Management Enhancements
• Employee State Tax Forms: Wizard updates

We’ve included highlights of key updates below. For a complete overview, please see the summary posted in the Quick Links section of isolved.

Benefits/HR

Secure Act 2.0 Updates – Roth Catch-up for Highly Paid Individuals (HPIs)

We’re introducing new HPI (Highly Paid Individual) functionality to support Section 603 of the Secure 2.0 Act, with additional enhancements planned in upcoming releases. This update automates Roth catch-up treatment for eligible employees and includes admin tools, payroll logic updates, a new HPI calculation and enhanced reporting to streamline compliance and operational setup.

• To prepare for these changes, we recommend:
  • Review your plan documents with your plan provider, recordkeeper, or TPA to confirm that Roth catch-up contributions are allowed under your plan
  • Make any necessary amendments if they are not yet included

Key Features:

• What: New HPI functionality that automatically routes catchup contributions to a Roth HPI deduction code when employees meet HPI eligibility and age requirements.
• Payroll & operations: Sequencing rules ensure correct allocation to Roth HPI codes; payroll exceptions will warn when HPI employees lack a valid HPI deduction code.
• Reporting: New “Deferred Comp Highly Paid Individuals” report with flexible filters to identify HPI eligible employees, prior year Box 3 wages, overrides and plan enrollment.
• Supporting tools: Imports,report writer and change logs have been updated to include the new HPI override field.

Additional Configuration Enhancements:

• Deferred Comp EE Contribution Plan Matches: New “Limit to specified deductions” option on the Employee Contribution Match settings to restrict employer matches for specific plan types.

• Deferred Comp HPI Catch-up Deduction Code: Allows admins to select the deduction code used to route HPI catch-up contributions for each deferred compensation plan.

• Deferred comp HPI Client Report: Client-level report to identify participants who meet HPI criteria.

• HPI Calculation Parameters: Maps the deduction amount parameter to the calculated HPI catch-up deduction amount so deduction amounts are automatically derived for payroll processing.

HPI Year End Designation: Box 12 and Box 14 for W-2 reporting.

Identity

Self Service Management Enhancements

We’ve added a new Identity Management tab to the self-service Management page, providing improved visibility and control over Identity account information.

Features

• User Overview Table: Displays Identity-related details for each user, including email address, phone number, phone number status, number of passkeys and authenticator status.
  • If you find a phone number on the identity tab needs to be updated, please reach out to your account specialist for assistance.
• Search & Filter: Search and filter across all columns to quickly locate specific users.
• Quick Actions: Remove passkeys or authenticators directly from each user row using dedicated action buttons.
• Consistent Design: Matches the familiar look and feel of the existing Self-Service Management page.
• Access: The new Identity Management tab is available to all users with access to the Self-Service Management page. If you do not see this menu item under Employee Admin Tools, please contact your account specialist to update your view

Employee State Withholding Tax Forms

Tax Wizard Updates

The employee tax wizard has been updated for 11 states with the newest version of the income tax withhold forms below.

• Arizona:
  • Form A-4: Employee’s Arizona Withholding Election
  • Form A-4C: Request for Reduced Withholding to Designate for Tax Credits
  • Form A-4V: Voluntary Withholding Request for Arizona Resident Employed Outside of Arizona
  • Form WEC: Employee Withholding Exemption Certificate
• California:
  • Form DE 4: Employee’s Withholding Allowance Certificate
  • Form DE4(SP): Certificado de Retenciones del Empleado
• Connecticut:
  • Form CT-W4NA: Employee’s Withholding Certificate Nonresident Apportionment
• Hawaii:
  • Form HW-4: Employee’s Withholding Allowance and Status Certificate
  • Form HW-6: Employee’s Statement To Employer Concerning Nonresidence In The State Of Hawaii
• Louisiana:
  • Form L-4E: State of Louisiana Exemption from Withholding Louisiana Income Tax
• Minnesota:
  • Form MWR: Reciprocity Exemption/Affidavit of Residency for Tax Year 2026
  • Form W-4MN: Minnesota Employee Withholding Certificate
• Mississippi:
  • Form 89-350: Mississippi Employee’s Withholding Exemption Certificate
• Montana:
  • Form MW-4: Montana Employee’s Withholding Allowance and Exemption Certificate
• New York:
  • Form IT-2104: Employee’s Withholding Allowance Certificate
  • Form IT-2104-SNY: Certificate of Exemption from Withholding for the START-UP NY Program
• North Carolina:
  • Form NC-4: Employee’s Withholding Allowance Certificate (Long Form)
  • Form NC-4 EZ: Employee’s Withholding Allowance Certificate (Short Form)
  • Form NC-4 NRA: Nonresident Alien Employee’s Withholding Allowance Certificate
• Oregon:
  • Form Metro/MultCo OPT: Employee OPT IN/OUT Form Metro Supportive Housing Services Tax (SHS) Multnomah County Preschool for All Tax (PFA)
  • Form Metro OPT: Employee OPT IN/OUT Form Metro Supportive Housing Services Tax (SHS), Declaración de retenciones y certificado de exención de Oregon