# State auto-IRA mandates

> State auto-IRA mandates, with California's CalSavers as the example: who must facilitate it, the penalties, and how a plan of your own exempts you.

Source: https://lopifi.com/learn/startup-retirement-plans-401k-simple-ira/state-auto-ira-mandates
Part of: Lopifi — US GAAP books on autopilot, checked by a CPA (https://lopifi.com)

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**Do employers have to offer a retirement plan? (CalSavers and state auto-IRAs)** State auto-IRA mandates, with California's CalSavers as the example: who must facilitate it, the penalties, and how a plan of your own exempts you.

A [state auto-IRA](https://lopifi.com/md/glossary/state-auto-ira) is a state program an employer must make available if it offers no retirement plan of its own. California's is CalSavers: state law generally requires every California employer with one or more employees that does not offer an employer-sponsored plan to facilitate its employees' participation. Employer participation is mandatory; employees can opt out.

> “Current state law generally requires all California employers with one or more employees that do not offer an employer-sponsored retirement to facilitate their employees’ participation in the Program by December 31, 2025.”

— [California FTB — Bill analysis, AB 2650 (2026), Current state law](https://www.ftb.ca.gov/tax-pros/law/legislation/2025-2026/AB2650-051826-052226.pdf) (PDF), CalSavers: California's auto-IRA mandate and its penalties

The penalties are per eligible employee: $250 if noncompliance continues after the program's final notice, and a further $500 if it continues 90 days after the Franchise Tax Board's first notice. Offering any qualified plan — a 401(k), a SIMPLE IRA — takes the employer out of the mandate. Other states run programs of their own; check each state where you have employees.

## Where this page's rules come from

- [California FTB — Bill analysis, AB 2650 (2026), Current state law](https://www.ftb.ca.gov/tax-pros/law/legislation/2025-2026/AB2650-051826-052226.pdf) (PDF) — CalSavers: California's auto-IRA mandate and its penalties (state)

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- **Part of:** [Retirement plans: 401(k), safe harbor and SIMPLE IRA](https://lopifi.com/md/learn/startup-retirement-plans-401k-simple-ira) — 4 min
- **Terms taught:** [State auto-IRA](https://lopifi.com/md/glossary/state-auto-ira)
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