CalSavers definition of an employee:

• Age 18, paid by W-2, and worked for 30 days from D.O.H.

Roth IRA’s only:

• IRS 2022 Limit $6,000.00.

Employees will be Auto-Enrolled at 5% of employee’s compensation:

• Auto-Escalated up 1% each year after that up to 8%.
• They have the option to opt-out, or make a different election.

Employees are responsible for knowing if they are eligible for the Roth IRA:

• The MAGI (Federal Modified. Adjusted Gross Income) Limits still apply.
• $137,000 for single filers and $203,000 for married couples filing jointly.

No correction for the employees that forgot to opt-out or that didn’t qualify. CA is handling the record-keeping for CalSavers. The employees pay all fees associated with CalSavers:

• Estimated at 0.82% to 0.95% of their account balance.

Employer Administration with CalSavers:

• Required to submit a full employee census to CalSavers (keep them updated).
• Track all eligible employees.
• Provide enrollment packet to all employees 30 days after DOH.
• If no election is made in the next 30 days (60 days from DOH).
• Set up the 5% Auto Enroll in payroll to send the Roth IRA contribution to CalSavers.
• Track in payroll and implement the Auto Escalate of 1% each year up to 8%.
• Auto Escalate employees that did not make a separate election to opt-out of auto escalation.
• Hold Open Enrollment every year (Oct 1st – Nov. 30th).
  • Re Auto Enroll anyone that is not participating for 6 months or longer.
• 6 month look back each year for Auto Escalate.
  • Track if employee has been participating for 6 months with no auto escalation.
  • Provide 60 day notice that they will be auto escalated Jan 1st if they do not opt-out again.