If your medical practice employs five or more employees, then you should know that California state law requires that you register to facilitate CalSavers if you do not already offer an employer-sponsored retirement plan. For employers with 50 or more employees, the deadline to register is June 30, 2021.
CalSavers is a retirement savings program for private sector workers whose employers do not offer a retirement plan. This program gives employers an easy way to help their employees save for retirement, with no employer fees, no fiduciary liability, and minimal employer responsibilities.
The following deadlines to register based on the size of the business are:
|
Size of Business |
Deadline |
|
Over 100 employees |
September 30, 2020 (Deadline Passed. Register as soon as possible to avoid penalties.) |
|
Over 50 employees |
June 30, 2021 |
|
Five or more employees |
June 30, 2022 |
Are There Penalties for Not Enrolling in CalSavers?
If you do not offer a tax-qualified retirement plan or enroll in CalSavers by the registration deadline, you will be subject to the following penalties for noncompliance:
90 days after deadline – $250 per eligible employee
180 days after deadline – $500 per eligible employee
Registration Information
For more information about the CalSavers and to register, visit https://employer.calsavers.com/.
Ongoing Responsibilities
Once your CalSavers employer account is set up and ready to go, you’ll be responsible for ongoing responsibilities: submitting employees’ contributions
and adding new employees or removing employees
who have left your company.
Activities for Which You Are Not Responsible
CalSavers does not include any employer fees or employer match contributions. You are also not responsible for:
Enrolling employees, disseminating information, or answering questions about the program.
Managing investment options, including choice of investment funds and processing employee investment change requests.
Processing distributions.
Answering questions about investment options. Employers should not give investment or tax advice.
Managing employee changes or account maintenance, which include but are not limited to contact information and beneficiary information.
Your employees will be responsible for maintaining their account information once it is established.
This information is being provided to CAP members as a courtesy of CAP Physicians Insurance Agency, Inc. (CAP Agency) and our preferred insurance broker, Ashbrook-Clevidence to help make running the business side of your practice a bit easier.
If you are interested in satisfying this retirement savings requirement by using a 401K plan that can provide more choices for investments, tax savings, and the opportunity to save more for retirement, please reach out to the retirement plan specialists at Ashbrook-Clevidence.
For help with CalSavers, alternative retirement plan solutions, and even other areas of employee benefits, please contact:
Chris Clevidence l 800-447-4023 l chrisc@aclevidence.com
David Penner l 800-447-4023 l davidp@aclevidence.com
Gary Flater l 800-447-4023 l garyf@aclevidence.com