Live mandate
Does my California business have to offer a retirement plan?
Short answer
Yes, if you had at least one employee in California last year and don’t offer a retirement plan. You either register for CalSavers or tell CalSavers you already offer a plan such as a 401(k), 403(b), SEP or SIMPLE IRA. It’s due by December 31 of the year CalSavers notifies you. Skipping it can cost $250 per eligible employee, then another $500 per employee.
Who must comply
California requires every employer with at least one eligible California employee in the previous calendar year to register for CalSavers unless it already sponsors a qualified retirement plan. CalSavers decides who is mandated each spring from the quarterly DE 9C wage reports employers file with EDD. You do not need to register if your only employees are owners or officers, you have no California employees, or you are a government, religious or tribal organization; those employers still report the exemption.
Deadlines
If CalSavers notified you in 2026, your deadline to register or report an exemption is December 31, 2026. The phased waves for larger employers ended between 2020 and 2022, and the final wave for employers with 1 to 4 employees closed December 31, 2025. If your deadline has passed, CalSavers says to register immediately to avoid enforcement.
Penalties
If you don’t let eligible employees join and don’t have a good reason, California can charge $250 per eligible employee once you’re 90 days past the notice, and another $500 per employee at 180 days. The Franchise Tax Board collects the penalty and may keep sending an annual notice for another $500 per employee until you comply.
How to get exempt
Offering a qualified retirement plan such as a 401(k), 403(b), SEP or SIMPLE IRA exempts you from CalSavers. You still have to report the exemption: go to the CalSavers employer portal, choose Register or Request Exemption, and enter your EIN or TIN and the CalSavers Access Code from your notice. CalSavers may ask you to upload proof of your plan, and you get a confirmation email with your exemption status.
CalSavers or a 401(k)?
CalSavers accounts are Roth IRAs, so each saver is held to the IRA limit: $7,500 a year in 2026 and 2027, or $8,600 at 50 or older, across all their IRAs. Higher earners can be phased out of Roth contributions altogether, starting at $153,000 of income for single filers in 2026 and $158,000 in 2027. A 401(k) leaves far more room: employees can defer $24,500 in 2026 and $25,500 in 2027, plus catch-ups from age 50. CalSavers doesn’t allow employer contributions, so you can’t add a match; a 401(k) can include one. New savers start at 5% of pay, rising 1% a year to 8% unless they change it.
Sources
CalSavers: Eligibility and Exemptions (Help Center: Registration) (employer.calsavers.com) CalSavers: CalSavers for Employers (employer.calsavers.com) CalSavers: Frequently Asked Questions (calsavers.com) CalSavers: Program Details (savers) (saver.calsavers.com) California Franchise Tax Board: CalSavers (ftb.ca.gov) Internal Revenue Service: 401(k) limit increases to $24,500 for 2026, IRA limit increases to $7,500 (irs.gov) Internal Revenue Service: COLA increases for dollar limitations on benefits and contributions (irs.gov) Internal Revenue Service: 401(k) plan overview (irs.gov) Georgetown University Center for Retirement Initiatives: States: 2026 state program status (as of November 6, 2026) (cri.georgetown.edu)
This page is general information, not legal or tax advice. Confirm current rules with the state program before acting.
