Current Rate
What Is the California SDI Rate for 2026?
The California SDI (State Disability Insurance) rate for 2026 is 1.3%, effective January 1, 2026. This marks an increase from the 1.2% rate that applied throughout 2025. The California Employment Development Department (EDD) sets this rate annually based on the financial health of the Disability Insurance Fund under Section 984 of the California Unemployment Insurance Code.
SDI is an employee-only payroll tax. Employers do not contribute to the fund. Instead, employers withhold the SDI amount from each employee's gross wages and remit it to the EDD. The 1.3% rate is the same for all covered workers. California does not vary the SDI rate by income level, industry, or employer size.
The withholding funds two separate programs: Disability Insurance (DI) for workers who cannot work due to illness, injury, or pregnancy, and Paid Family Leave (PFL) for workers who need time off to care for a seriously ill family member or bond with a new child. Since January 1, 2024, there is no taxable wage ceiling for SDI. Every dollar of wages is subject to the 1.3% withholding, regardless of how much an employee earns.
Paycheck Math
How Is California SDI Calculated on Your Paycheck?
The calculation is straightforward: multiply your gross wages for the pay period by 0.013 (1.3%). Because there is no wage cap, the rate applies to your entire gross pay every pay period throughout the year. No withholding cutoff kicks in at higher earnings.
- Biweekly paycheck ($2,884.62 gross): $2,884.62 x 0.013 = $37.50 withheld
- Semi-monthly paycheck ($3,125.00 gross): $3,125.00 x 0.013 = $40.63 withheld
- Weekly paycheck ($1,442.31 gross): $1,442.31 x 0.013 = $18.75 withheld
All three examples above assume a $75,000 annual salary. The withholding appears on your pay stub under various labels including 'CASDI,' 'CA SDI,' 'SDI,' or 'CA Disability.' If you do not see it listed, check your pay stub's deduction section or ask your payroll department.
SDI withholding is separate from California state income tax, federal income tax, Social Security, and Medicare. It is also separate from any voluntary disability coverage your employer may offer. This is general information, not tax advice.
SB 951
What Changed When California Removed the SDI Wage Cap?
Before 2024, California SDI contributions had a taxable wage ceiling. In 2023, for example, only the first $153,164 of wages was subject to SDI withholding. Once an employee's year-to-date earnings exceeded the cap, no additional SDI was withheld for the rest of the year.
Senate Bill 951, signed into law in 2022, eliminated this ceiling effective January 1, 2024. Under the new rule, all wages are subject to SDI contributions with no upper limit. This change primarily affects higher-income earners who previously stopped paying SDI partway through the year.
For an employee earning $300,000 annually, the 2026 SDI withholding totals $300,000 x 0.013 = $3,900. Before the cap removal, a similar earner would have contributed on only the capped portion of wages. SB 951 also raised wage replacement rates beginning January 1, 2025: to 90% for lower-wage earners, up from 70%, and to 70% for all other covered workers, up from 60%.
Rate History
How Have California SDI Rates Changed Over Time?
The SDI rate is not fixed. The EDD recalculates it each year under Section 984 of the California Unemployment Insurance Code, based on the projected balance of the Disability Insurance Fund. When the fund runs low, the rate increases; when the fund is healthy, it can decrease.
| Year | SDI Rate | Notable Change |
|---|---|---|
| 2020 | 1.00% | Annual wage cap applied |
| 2021 | 1.20% | Annual wage cap applied |
| 2022 | 1.10% | SB 951 signed into law |
| 2023 | 0.90% | Last year with wage cap |
| 2024 | 1.10% | Wage cap eliminated |
| 2025 | 1.20% | No cap |
| 2026 | 1.30% | No cap |
The EDD has projected a 2027 SDI contribution rate of 1.4%, though this figure is subject to revision based on fund performance and any new legislation. The rate has increased three years running since bottoming out at 0.90% in 2023.
Benefits
What Benefits Does California SDI Provide?
SDI funds two distinct benefit programs. Disability Insurance (DI) provides partial wage replacement when you cannot work due to a non-work-related illness, injury, or pregnancy. Paid Family Leave (PFL) provides partial wage replacement when you take time off to care for a seriously ill family member, bond with a new child, or assist with a qualifying military event.
The benefit amount depends on your earnings during a 12-month base period that falls roughly 5 to 18 months before your claim start date. The replacement rate structure for 2026 is:
- Lower-income workers: 90% of weekly wages for quarterly earnings up to approximately $16,280
- Mid-range earners: Flat $1,127 per week for quarterly earnings between roughly $16,280 and $20,931
- Higher-income workers: 70% of weekly wages for quarterly earnings above approximately $20,931, up to the maximum
- Maximum weekly benefit (2026): $1,765
DI benefits can last up to 52 weeks. PFL benefits can last up to 8 weeks within a 12-month period. To qualify, you must have earned at least $300 during your base period and have had SDI deductions withheld from those wages. Neither program provides job protection on its own — that comes from separate laws like the California Family Rights Act (CFRA) or the federal Family and Medical Leave Act (FMLA).
SDI Withholding on a $75,000 Salary (2026)
| Line item | Amount |
|---|---|
| Annual gross salary | $75,000.00 |
| SDI rate (2026) | 1.3% |
| Annual SDI withholding ($75,000 x 0.013) | $975.00 |
| Per biweekly paycheck ($975 / 26) | $37.50 |
| Per semi-monthly paycheck ($975 / 24) | $40.63 |
| Per weekly paycheck ($975 / 52) | $18.75 |
How much California SDI is withheld from a $75,000 annual salary at the 2026 rate of 1.3%, assuming biweekly pay with 26 pay periods.
Who Pays
Who Must Pay California SDI?
Nearly every W-2 employee working in California is subject to SDI withholding. This includes full-time, part-time, and seasonal workers. The tax applies from the first dollar earned, with no minimum earnings threshold for withholding.
A few categories of workers are exempt:
- Some government employees covered by alternative disability programs
- Railroad workers covered under the Railroad Unemployment Insurance Act
- Workers whose employers maintain an approved voluntary plan (VP) that provides benefits equal to or better than the state plan
Self-employed individuals, independent contractors, and sole proprietors are not automatically covered. However, they can opt into coverage through the Disability Insurance Elective Coverage (DIEC) program administered by the EDD. Enrollment must occur before any disability event.
Employers do not pay any portion of the SDI tax. Their obligation is limited to withholding the correct percentage from employee wages and remitting those amounts to the EDD on the required schedule. This distinguishes SDI from California's Unemployment Insurance (UI) and Employment Training Tax (ETT), which are employer-funded obligations.
Remote Workers
Does California SDI Apply to Remote Workers?
SDI obligations follow the location where work is physically performed. If you live in California and work remotely from your California home for any employer — including one headquartered in another state — your wages are subject to California SDI withholding at the 1.3% rate.
Conversely, if you live outside California but work for a California-based company from your home in another state, your wages are generally not subject to California SDI. The determining factor is the state where services are rendered, not where the employer is incorporated or where its headquarters sit.
Multi-state workers who split time between California and another state may need to allocate wages. Only the portion of wages earned for work performed in California is subject to SDI. Employers who hire California-based remote workers for the first time should register with the EDD and begin SDI withholding from the employee's first paycheck. Employers handling multi-state payroll should consult the EDD's guidance on proper allocation and withholding to stay compliant.
If you relocate to California mid-year, SDI withholding begins with the first paycheck earned for work performed in the state. If you leave California mid-year, withholding stops once you are no longer performing work in the state. There is no proration or true-up at year-end for SDI the way there is for state income tax — the withholding simply follows the pay period where work occurs.
Official Source
Where Can You Find the Current California SDI Rate?
The EDD publishes the official SDI contribution rate each year on its website. The primary source is the Contribution Rates and Benefit Amounts page at edd.ca.gov/disability/Contribution_Rates_and_Benefit_Amounts. This page lists the current rate, the maximum weekly benefit, and a comparison with prior-year figures.
The EDD also publishes the DE 3395 document (Tax Rates, Wage Limits, and Value of Meals and Lodging), which provides a comprehensive table of all California payroll tax rates in one reference sheet. Employers typically receive rate notices each December for the upcoming calendar year. If you are unsure about your SDI withholding, compare the amount shown on your pay stub against 1.3% of your gross pay for any 2026 pay period. Any discrepancy may indicate an outdated withholding rate or a voluntary plan arrangement. Bookmark the EDD page so you can verify the rate each January when the new contribution percentage takes effect.
Questions
California SDI Rate for 2026: What Employees Pay and What They Get FAQ
Is California SDI mandatory for all employees?
SDI is mandatory for nearly all W-2 employees working in California. The tax applies from the first dollar of wages with no minimum earnings threshold. A small number of workers are exempt, including some government employees covered by alternative disability programs and railroad workers covered under federal railroad unemployment insurance. Employers with approved voluntary plans may also exempt their employees if the plan meets or exceeds state benefits.
Can self-employed workers get California SDI coverage?
Self-employed individuals, independent contractors, and sole proprietors are not automatically covered by SDI. They can voluntarily enroll in the Disability Insurance Elective Coverage (DIEC) program through the EDD. Enrollment must happen before any disability occurs. Once enrolled, participants pay quarterly contributions and gain access to DI and PFL benefits similar to those available to W-2 employees.
Does California SDI cover pregnancy and maternity leave?
Yes. Disability Insurance covers pregnancy-related disabilities, typically providing benefits for up to four weeks before the expected delivery date and six to eight weeks after delivery depending on the type of birth. After the DI claim ends, a new parent can file a Paid Family Leave claim to receive additional wage replacement while bonding with the newborn for up to eight weeks.
How long can I receive California SDI disability benefits?
Disability Insurance benefits can last up to 52 weeks per claim. To qualify, you must be unable to perform your regular or customary work for at least eight consecutive days, have earned at least $300 during your base period, and have had SDI deductions withheld from those wages. PFL benefits, also funded by SDI contributions, can last up to eight weeks within any 12-month period.
What is the difference between SDI and Paid Family Leave?
Both programs are funded by the same 1.3% payroll deduction, but they serve different purposes. Disability Insurance replaces a portion of wages when you cannot work due to your own non-work-related illness, injury, or pregnancy. Paid Family Leave replaces wages when you take time off to care for a seriously ill family member, bond with a new child, or participate in a qualifying military event. You cannot collect both at the same time.
Do employers pay any portion of the California SDI tax?
No. SDI is funded entirely by employee contributions. Employers are responsible for withholding the correct amount from each paycheck and remitting it to the EDD, but the financial burden falls solely on the worker. This is different from California Unemployment Insurance and Employment Training Tax, which are employer-funded payroll obligations.
Will the California SDI rate increase again in 2027?
The EDD has projected a 2027 SDI contribution rate of 1.4%, which would represent the fourth consecutive annual increase. However, the final rate is set each year based on the Disability Insurance Fund balance and is subject to change. The EDD typically announces the upcoming rate in late fall for the following calendar year.
- Sources: California EDD — Contribution Rates and Benefit Amounts · California EDD — Determine Taxable Wages and Calculate Taxes · California EDD — Calculating DI Benefit Payment Amounts · California EDD — SDI Contribution Rate 2026 Quick Stats · EDD — May 2026 Disability Insurance Fund Forecast · EDD — Tax Rates, Wage Limits, and Value of Meals and Lodging (DE 3395)
- Last updated September 10, 2026
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