Changes In Store for California Payroll Taxes in 2011

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Via California Employment Development Department

Among other changes, beginning in 2011, California employers will now be required to report their Unemployment Insurance, Employment Training Tax and State Disability Insurance contributions each quarter, in addition to their Personal Income Tax withholdings.  In the past, these taxes were reported annually by January 31st.

Following the excerpt from the CA EDD announcement:

“Important Payroll Tax Changes in 2011

Change to Quarterly Reporting

Starting with the first quarter of 2011, employers will begin filing new:

  • Quarterly Contribution Return and Report of Wages (DE 9)
  • Quarterly Contribution Return and Report of Wages (Continuation) (DE 9C).

Employers will report their Unemployment Insurance, Employment Training Tax, and State Disability Insurance contributions, along with the Personal Income Tax withholdings, quarterly on the DE 9 instead of annually on the Annual Reconciliation Statement (DE 7). Detailed wage items for each worker will be reported on the DE 9C instead of the Quarterly Wage and Withholding Report (DE 6). Employers will still use the DE 6 and DE 7 for years prior to 2011.

The change to quarterly reporting will allow EDD and employers to identify overpayments more quickly, which will result in faster refunds. In addition, EDD will be able to promptly notify employers of any amounts due.

Registered employers will receive the new forms automatically by mail starting in 2011. The new forms will also be available online and at local EDD offices in December 2010.

Employers will continue to make deposits using the Payroll Tax Deposit (DE 88ALL) form. The quarterly reporting change will not affect deposit and return due dates. Please refer to the California Employer’s Guide (DE 44) for deposit and reporting requirements.

NOTE: This quarterly reporting change does not affect Annual Household employers, Disability Insurance Voluntary Plan filers, or Disability Insurance Elective Coverage filers.

Expanded e-Services for Business

Beginning in the spring of 2011, EDD will significantly expand its e-Services for Business. Employers will be able to conduct more business online with EDD including:

  • Viewing account information
  • Filing reports
  • Paying tax deposits and liabilities”
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