Help the Employees of Your Small Business Save for Retirement
By: Sofia F. Hinojosa, CPA, Osborne Rincon CPAs
A great majority of Americans aren’t adequately saving for retirement. Social Security will soon begin to pay less than 100% of promised benefits if Congress takes no action. Many states are stepping up to facilitate plans for retirement, including California.
California Senate Bill 1234, signed by Governor Brown in 2016, began the development of CalSavers – a retirement savings plan for private sector workers whose employers do not offer a retirement plan.
California employers with at least five employees will be required to either provide a private market retirement plan for their employees or register for CalSavers to enable their employees to make direct payroll contributions to their individual retirement account.
There are no fees for employers to facilitate the program, but financial penalties may be imposed for non-compliance after a notice is served. You will need to devote some time to take care of administrative duties so you have everything in order when it’s time to be in compliance with California’s new requirements.
Now might be a good time to start having discussions with your Financial Planner or CPA about various retirement plan options that your business may have, and also possible tax savings.
For more information on the CalSavers program, refer to the California State Treasurer’s website.
Sofia F. Hinojosa grew up in the Coachella Valley. She graduated from University of San Diego and received her CPA designation in 2010, and spent 10 years at CBIZ MHM, LLC, in San Diego prior to joining Osborne Rincon. Osborne Rincon is one of the oldest and most respected full-service accounting firms in the Coachella Valley. To learn more, call (760) 777-7805 or go to www.OsborneRincon.com.
Last modified: June 27, 2019