CalSavers: Do You Have 5 or More Employees?

Employers with 5+ employees must offer a retirement program or face fines

Employers may not realize that we’re inching up on the final registration deadline for the CalSavers mandate that will impact every business with five or more employees.

What many small business owners still don’t know about CalSavers

CalSavers (Senate Bill 1234) was signed into law in 2016 with a three-year tiered rollout. The bill requires all California businesses with five or more employees to offer a retirement plan to their employees.

• The number of employees is determined by W2 filings and includes BOTH full- and part- time employees, so the mandate applies to most small businesses.
• The mandate gives employers the option to either adopt their own plans (i.e., 401k) or participate in a new state-run Roth retirement plan.
• The registration deadline for businesses with 5+ employees is June 2022, followed by a grace period for noncompliance, followed by a tiered penalty phase of up to $750 per employee. 
• The registration deadlines for businesses with 100+ employees and 50+ employees have already passed: June 2020 and June 2021 respectively.

There’s no Covid hall pass on this one: They’re enforcing penalties now

The Franchise Tax Board (FTB) is enforcing the penalties, so the mandate has teeth. The good news is there’s time for small business owners to get educated and understand the options so they can comply with the mandate and avoid penalties.

The CalSavers program offers limited benefits to business owners

The CalSavers program itself--what the state is offering if businesses don’t adopt their own plans by the deadline--does NOT provide much benefit to business owners themselves. Typically, an employer-sponsored retirement plan, like a 401k, allows the business owner to also participate in the plan and reap the benefits of putting away money for retirement, sheltering income on a tax-deferred basis, and maximizing the tax benefits, both for the business and as an individual. A plan might also allow for employer contributions, such as matching funds, which can increase the tax benefits to the owner while providing a good recruitment and retention tool for employees.

The limited CalSavers program, however, does not provide employers with those benefits. The restrictive Roth (after-tax) provision will exclude many owners from participating due to Roth income limits. The state program also places the full administrative burden on the business owner to manage enrollment and service the plan.

• A restaurant/bar owner, for example, who has struggled to keep the doors open during Covid, might seek options that minimize cost and administrative burden--the minimum to meet the mandate--but help them with their own long-term retirement or exit strategy.
• Independent contractors, however, who have never been busier, might seek plans that would maximize their ability to shelter more income and offset the increased tax liability fueled by growth during Covid.

Understanding the options to make informed decisions

There’s not enough balanced information on the CalSavers online website to provide a full understanding of the pros and cons of the CalSavers mandate. If business owners have to comply with the mandate anyway, it’s in their best interests to take the time to understand how they might be able to also benefit themselves.

One of our colleagues, Kirk Cowan, of Edward Jones, is available to answer questions. He provides a complimentary review to help small business owners make informed decisions.

Guideway, assisting our clients in uncontested legal matters

As Legal Document Assistants, we assist our clients in uncontested legal matters, such as Divorce and Probate. Our fees are significantly lower than those of attorneys. Why work with Guideway? One flat fee. There are never annoying add-on charges for copying, phone calls and other miscellany. Where appropriate, we also notarize documents and file them with the County Recorders’ Office.

We’re a single point of contact. You’ll work with a dedicated specialist who is available for questions and support throughout the process. We’ve been in business since 2003 and have expanded to three Bay Area offices–Dublin, Oakland and Walnut Creek. More than 60% of our business comes from referrals and repeat business.

We’re proud of our comprehensive Living Trust package that includes a Power of Attorney and Advanced Healthcare Directive. We provide a hard copy as well as a soft copy of your documents. More questions? Contact us today.

Guideway services the entire Bay Area

Berkeley, El Cerrito, Richmond, Pinole, Alameda, San Leandro, Castro Valley Newark, San Lorenzo, Concord, Alamo, Danville, Lafayette, Orinda, Moraga, Pleasant Hill, Martinez, Pittsburg, Antioch, Brentwood, Oakley, Discovery Bay, Pleasanton, San Ramon, Livermore, Tracy and Fremont. Our clients also live in the Napa Valley, Benicia, Vallejo, Martinez, Fairfield.

 

Safe Deposit Boxes: Are They Still Relevant?

Concerns about data privacy extend to how we protect our digital records, including Living Trusts, Deeds and other important legal documents. We frequently field questions about whether a safe deposit box is appropriate for storing these documents.

Limitations of safe deposit boxes

The most basic dependency is that safe deposit boxes are limited to banking hours, so important items that may be needed at a moment’s notice are better off stored elsewhere. Think about if you store your passport, then need to take an emergency trip. Or what if your Living Trust is stored in your safe deposit box and you’re gravely injured. Your family may need to access this on a Saturday, but they’ll have to wait until the bank reopens on Monday. Other complications? One client’s bank closed for three months during Covid. In another matter, a Probate case was centered around gaining access to the deceased’s safe deposit box. If you do store your Living Trust in a safe deposit box, make sure the box is in the name of Trust and that all who need access are clearly entitled.

One central location for hard-to-replace items

According to Dave McGuinn, founder and president of Safe Deposit Specialist, a financial consulting firm, “If you have anything that is hard to replace or has sentimental value or you want to pass on to your kids, that’s probably the best reason for getting a safe deposit box. You’ve got one central location, and your family knows where your stuff is. My clients are still expanding vaults, adding boxes, and doing everything they can to accommodate their customers,” says McGuinn.

While safe deposit boxes may still be viable, brick-and-mortar bank branches are vanishing. You may have to travel farther to access or lease a new deposit box. Some big banks are moving away from safe deposit boxes, especially in their new branches. In 2020, banks closed a record 3,324 branches nationwide and opened 1,040.

A home safe: The best place to store important documents?

Home safes are a good solution, but for them to be secure, they should be difficult to move, fireproof and waterproof. The general recommendation is to make a digital copy of your legal documents and save them online, either in a Dropbox folder or the Cloud. It’s important to share the location of the safe and provide access for a trusted family member or friend.

What should go in a safe deposit box?

Items that should be stored in a safe deposit box are those that are expensive or that may be difficult or impossible to replace. Examples include heirloom jewelry, original copies of adoption papers and important family photos. Valuables such as jewelry or collectibles should be stored in a safe deposit box only if they are insured, says Naomi Becker Collier, an attorney specializing in trust and estate planning.

A sign of the times: The American Bar Association also recommends placing valuables in plastic bags or containers labeled with the leaser’s name to protect the box’s contents in case of a plumbing catastrophe or flood. Remember that climate change has changed the landscape.

According to McGuinn, “Some of the big banks put a clause in the safe deposit box agreement that you can’t put anything of value in them, which kind of takes away the need of a safe deposit box.” He notes that banks don’t vet what goes in your safe deposit box — you put items in and take items out in private – so the restrictions aren’t enforceable. Some financial institutions also advise against storing cash, guns or other potentially dangerous or illegal items in safe deposit boxes.

Insuring the contents of your safe deposit box

Be aware that the bank has no idea what’s in your box—it’s not insured by the bank, by the FDIC or by any other government agency. The contents can be insured through your own private insurer. Ask an agent about adding what’s called a “personal articles floater” to your home or auto policy. Let the insurer know the items are in a safe deposit box.

Share the location of your box with a trusted friend or relative

Once you pick a safe deposit box, let someone know where the box is. If you trust that person enough, put them on the safe deposit box’s contract. If you die, this will allow the person access without unnecessary legal entanglements and court orders. If you’ve appointed a Power of Attorney, that person may be able to access the box during your lifetime, according to Collier, the attorney. Be aware that a Power of Attorney is no longer valid once you die.

Worst things to store in a safe deposit box

We’ve learned from spy thrillers that a safe deposit box is where you store multiple passports, piles of cash in different currencies and guns. But a safe deposit box has value has a central repository for a family’s important legal documents and items such as expensive jewelry.

Here’s what not to store in your safe deposit box

• Emergency cash
• Instructions for a funeral
• Living Trust
• Passport
• Power of attorney
• Uninsured valuables

Best things to store in a safe deposit box

• Adoption records
• Armed service records
• Birth certificates
• Business/legal contracts
• Citizenship/naturalization papers
• Collectibles
• Death certificates
• Family photos
• Jewelry
• Marriage/divorce records
• Property records
• Vehicle titles

Guideway, assisting our clients in uncontested legal matters—including Living Trusts

As Legal Document Assistants, we assist our clients in the preparation of legal documents for uncontested legal matters–those in which parties are in agreement about the division of property. Our fees are significantly lower than those of attorneys. Why work with Guideway? One flat fee. There are never annoying add-on charges for copying, phone calls and other miscellany. Where appropriate, we also notarize documents and file them with the County Recorders’ Office.

We’re a single point of contact. You’ll work with a dedicated specialist who is available for questions and support throughout the process. We’ve been in business since 2003 and have expanded to three Bay Area offices–Dublin, Oakland and Walnut Creek. More than 60% of our business comes from referrals and repeat business.

We’re proud of our comprehensive Living Trust package that includes a Power of Attorney and Advanced Healthcare Directive. We provide a hard copy as well as a soft copy of your documents. More questions? Contact us today.

Guideway services the entire Bay Area

Berkeley, El Cerrito, Richmond, Pinole, Alameda, San Leandro, Castro Valley Newark, San Lorenzo, Concord, Alamo, Danville, Lafayette, Orinda, Moraga, Pleasant Hill, Martinez, Pittsburg, Antioch, Brentwood, Oakley, Discovery Bay, Pleasanton, San Ramon, Livermore, Tracy and Fremont. Our clients also live in the Napa Valley, Benicia, Vallejo, Martinez, Fairfield. 

Guideway assists our clients with uncontested legal matters, including Divorce. If you and your spouse can agree on division of property, you don’t need a lawyer, and we can save you a lot of money. We prepare the legal documents and guide you through it. 

There’s a general perception these days that Divorce is on the rise

Yet according to the Institute for Family Studies, the divorce rate reached a record low in 2019—for every 1,000 divorces, only 14.9 ended in divorce. But after a year and a half riding the pandemic rollercoaster, it’s a wonder anyone’s still married. Too much forced togetherness, economic insecurity and job loss. It’s been particularly hard on women—they’ve shouldered the bulk of childcare duties as whole families have switched to working and learning from home. But just as post-pandemic job hunters are seeking higher pay and more benefits, Covid has made many couples realize that they are no longer satisfied with the status quo. They want more from their relationships. 

According to Matt Lundquist, clinical director of Tribeca Therapy:

The pandemic has exacerbated issues that couples might have previously ignored, or tried to ignore. Alongside the enormous stress that Covid has created, many people in long-term marriages have found themselves at a crossroads. “I think this has been a forced moment of profound reflection. People are thinking a lot about what matters to them, what they want in life, what they tolerated living without that they don’t want to tolerate anymore. People are realizing that they have choices.”

 

Family attorney Alton L. Abramowitz: with SSRGA: “People are reexamining their lives, thinking: Is this the way I want to live for the next ten, 20 years?” he says. “There is this pent-up desire to move on with their lives.”

New York Magazine-The Covid Divorce: Couples want more from their relationships

He had promised he was sober, and then I found empty bottles

“What shifted for us is the lack of coping skills and distractions. We were in a very small house with our kids in lockdown. There was no place to hide. My ex’s alcoholism began to loom during the lockdown. I’m trying to raise the kids and he’s struggling with his addiction. With all of the stress of the pandemic, I needed the partner that I never got. I caught his stashing bottles around the house. My father has addiction issues, and it was not lost on me that I’m calling my mom, and she’s crying to me about this exact issue 20 years down the road. I had to end this cycle because it was not going to change.”

— Maya, 39, Montreal; married 16 years, together 21

 

She wanted a breadwinner, and I didn’t know how to get a six-figure job

“Before the pandemic, I was working for myself as a wedding photographer, and I was planting seeds for screenwriting and writing a book. I had worked hard to carve out a successful creative career. The pandemic changed things overnight—no one was having big weddings, so my income dried up; we didn’t meet our financial goals and ended the year with debt. I took a job with my wife’s company as a salesperson. The CEO loved my wife and hired me because of her. I never really succeeded in this culture. It cracked open big differences between us on how we define success and value money. We ended up separating, I moved to California and realized that I was happier alone. We are now planning to divorce, though not rushing to file papers.”

— Parker, 30, Southern CA; married four years, together seven

Why work with Guideway?

 

Guided Mediation. For those divorcing couples who have difficulty reaching consensus or for whom the Divorce process has stalled, our Guided Mediation, through a process of compromise and negotiation, assists couples in reaching successful conclusions.

One flat fee. There are never annoying add-on charges for copying, phone calls and other miscellany. Where appropriate, we also notarize documents and file them with the County Recorders’ Office. We’re a single point of contact. You’ll work with a dedicated specialist who is available for questions and support throughout the process. We’ve been in business since 2003, with three Bay Area offices–Dublin, Oakland and Walnut Creek. More than 60% of our business comes from referrals and repeat business. Schedule an appointment today. 

Guideway services the entire Bay Area

 

Berkeley, El Cerrito, Richmond, Pinole, Alameda, San Leandro, Castro Valley Newark, San Lorenzo, Concord, Alamo, Danville, Lafayette, Orinda, Moraga, Pleasant Hill, Martinez, Pittsburg, Antioch, Brentwood, Oakley, Discovery Bay, Pleasanton, San Ramon, Livermore, Tracy and Fremont. Our clients also live in the Napa Valley, Benicia, Vallejo, Martinez, Fairfield.

You’ve Inherited a Gun? California’s Strict Gun Laws May Surprise You

When you create a Living Trust, you need to move your assets into the Trust. Besides real estate, bank and brokerage accounts, you may have other assets of value. When John and Isabelle came in to create their Trust, John’s grandfather had just died and left him a valuable collection of antique guns. John was busy assessing their value; Isabelle was more concerned about having a large cache of guns around their kids and she knew that California has strict laws regulating the passing of firearms from one generation to the next—so restrictive that some people move out of the state to avoid them. To start:

• Assault weapons are for all practical purposes nontransferable.
• If the relative you’re planning to bequeath a gun is a drug addict or ex-felon, that transfer is illegal.

An important part of creating a Living Trust is funding it—moving your assets into the Trust. What belongs in the Trust? Real estate, bank and brokerage accounts and tangible personal assets—things like art, jewelry and vehicles.

John inherited his grandfather’s collection of antique guns

When John and Isabelle came into our Walnut Creek office to create their Trust, John’s grandfather had recently died and left him his valuable collection of guns—some dating back to the Civil War. While John wondered about getting his gun collection appraised, his wife had bigger concerns. They had small children, and she didn’t want a big cache of guns around the house. Isabelle also knew that California has strict laws regulating the passing of firearms from one generation to the next. So restrictive are California’s regulations that some people have moved out of state to avoid them.

For Americans wondering how they will pass their guns to their heirs, there are some important things to keep in mind. Regulations vary not only by what weapon is to be inherited, but by who is in line to receive it.

• Assault weapons are for all practical purposes nontransferable.
• If the relative you’re planning to bequeath a gun is a drug addict or ex-felon, that transfer is illegal.

What happens to severely restricted firearms when their owner dies? 

The weapons must be:

• Removed from California
• Sold to a federally licensed firearms dealer (FFL)
• Destroyed
• Turned over to law enforcement

The safest and simplest way to transfer a firearm from one person to another, even in distribution of an estate, is through a Federal Firearms Licensee who also has the necessary California licenses to deal in firearms. Not only do such dealers know firearms, but they can carry out required background checks on intended recipients.

Antique firearms can be transferred with going through the FFL

• Antiques—manufactured before 1899–curios and relics can legally be transferred without going through an FFL, but a qualified FFL should verify a firearm’s classification before transfer.
• Since January of 2014, transfer of antiques, curios and relics can’t be made unless the recipient has both a California Certificate of Eligibility and a Federal Curio or Relics license. The firearm must be registered with the California Department of Justice.

Penalties for transferring guns to minors

In California, minors can’t own handguns, and they themselves can be prosecuted in juvenile court for possession. There are exceptions, such as having the written consent of parents or legal guardians if weapons are for target shooting or hunting. There’s more. You can’t transfer or bequeath shotguns or rifles to minors, and a minor who possesses such weapons cannot be prosecuted, but anyone who gives, sells, bequeaths or transfers a gun to someone under 18–including the executor of a Will–can be criminally liable for doing so.

About Guideway, assisting our clients in uncontested legal matters—including Living Trusts

At Guideway, we are Legal Document Assistants who assist our clients in the preparation of legal documents for uncontested legal matters–those in which parties are in agreement about the division of property. Our fees are significantly lower than those of attorneys. Why work with Guideway? One flat fee. There are never annoying add-on charges for copying, phone calls and other miscellany. Where appropriate, we also notarize documents and file them with the County Recorders’ Office.

We’re a single point of contact. You’ll work with a dedicated specialist who is available for questions and support throughout the process. We’ve been in business since 2003 and have expanded to three Bay Area offices–Dublin, Oakland and Walnut Creek. More than 60% of our business comes from referrals and repeat business.

We’re proud of our comprehensive Living Trust package that includes a Power of Attorney and Advanced Healthcare Directive. We provide a hard copy as well as a soft copy of your documents. More questions? Contact us today.

Guideway services the entire Bay Area

Berkeley, El Cerrito, Richmond, Pinole, Alameda, San Leandro, Castro Valley Newark, San Lorenzo, Concord, Alamo, Danville, Lafayette, Orinda, Moraga, Pleasant Hill, Martinez, Pittsburg, Antioch, Brentwood, Oakley, Discovery Bay, Pleasanton, San Ramon, Livermore, Tracy and Fremont. Our clients also live in the Napa Valley, Benicia, Vallejo, Martinez, Fairfield.