Q:

What are California's SUI and SID taxes?

A:

California SUI tax is the state's unemployment insurance tax. California SDI tax is state disability insurance tax. SUI tax provides insurance such that if an employee is fired or otherwise unemployed through no fault of his own, he is able to draw unemployment benefits. The SDI tax financially compensates an employee who can no longer work due to injury or illness.

In most cases, employers and employees both pay SUI/SDI taxes to the state. The tax rates for each are determined by the state and may vary depending on the employer and the amount of money the employee makes per year. The taxes paid for SUI/SDI do not subsidize state-mandated employee training programs. In California, the Employment Training Tax (ETT) is a separate withholding, which in, 2014, amounts to 0.1 percent of the taxable wage limit of $7,000. Both SUI and SDI are subject to a wage limit. For 2014, the California state disability tax is 1 percent of all wages up to $101,636 per employee, per calendar year. This means that the most amount of money the state of California can take for SDI from an employee's pay is $1,016.36. The California SUI wage base is $7,000, and tax percentages vary from 1.6 to 6.2 percent, depending on the employer's state assigned percentage.


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