Deadline Looms for Employers with 5+ Employees to Offer A Qualified Retirement Savings Plan

Employers with just five (5) W-2 employees must be prepared for the June 30, 2022 deadline to offer a qualified retirement savings plan (including a 401(a), 401(k), 403(a), 403(b), 408(k), 408(p), or 457(b)) to their employees.

One option for employers that do not already have a plan in place is to register with the California state offered Calsavers program (formerly known as Secure Choice). Information about this plan is available here.

If employers fail to offer a plan by the deadline, they may receive a notice of noncompliance and face steep fines. A penalty of $250 per eligible employee if noncompliance extends 90 days or more after the notice. If found to be in non-compliance 180 days or more after the notice, the employer is responsible for an additional penalty of $500 per eligible employee.