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Assign or update California wage plan codes

by Intuit•1102• Updated 1 week ago

California has implemented wage plan codes that can be entered into QuickBooks Online Payroll and QuickBooks Desktop Payroll for each employee. The wage plan indicates the type of coverage your employee has. It’s correlated with your State Employer Account Number (SEAN).

To learn more about how employer accounts and wage plan codes are linked, check out this EDD Publication, or refer to the table for the description of the individual wage plan codes.

Wage Plan CodeEmployee Benefit Coverage and Use of Wage Plan Code
AYour employee’s total subject wages can only be used for UI benefit purposes. 
Used on accounts not covered by State Disability Insurance (SDI) or Voluntary Plan for Disability Insurance (VPDI)
JYour employee’s total subject wages can only be used for SDI benefit purposes. 
Used on accounts not covered by the State UI plan. 
LYour employee’s total subject wages can only be used for VPDI benefit purposes. 
Used on VPDI accounts not covered by the State UI plan.
PYour employee wages and/or withholdings are reported under an account that is only subject for PIT withholding purposes. 
RYour employee’s total subject wages can only be used for UI benefit purposes. This wage plan code is only valid for employees with one of the following DI exclusions when reported on an account subject to UI and SDI or VPDI: 
• Sole Shareholders who have filed a Sole Shareholder/Corporate Officer Exclusion Statement, DE 459, and have been approved for a DI exclusion under Section 637.1 of the California Unemployment Insurance Code (CUIC). 
• Third-Party Sick Pay recipients who claim an exclusion under Section 931.5 of the CUIC. 
• Religious employees who have filed a Religious Exemption Certificate, DE 5067, and have been approved for a Religious DI exclusion under Section 2902 of the CUIC. 
SYour employee’s total subject wages can be used for SDI and UI benefit purposes. 
Note: S can also be used for employees who are only subject to PIT and are being reported under an account that is subject to UI and SDI.
UYour employee’s total subject wages can be used for VPDI and UI benefit purposes. 
Used on VPDI accounts covered by a State UI plan.

If you need help determining the correct wage plan code for your employee(s), contact the Taxpayer Assistance Center.

Currently, QuickBooks automatically assigns CA SDI wage codes automatically to CA Employers based on the CA account number as follows:

First digit starts with a 9 = J

First digit starts with an 8 = P

All other account numbers = S

If you need to change the wage plan code for your employee, follow these steps:

  1. Go to Payroll then Employees.
  2. Select your employee.
  3. From Tax Withholdings, select Start or Edit.
  4. Under the CA wage plan code section, choose the appropriate wage plan code.
  5. Select Save.

You may see a warning message when running your payroll in QuickBooks Desktop Payroll that your employees are missing tax info. If your employees are in California, they may be missing the wage plan code.  

Assign a wage plan code to each employee

  1. Go to  Employees, then Payroll Setup.
  2. In the Payroll Setup window, select Employees, then Continue.
  3. Select your employee.
  4. In the Action ▼ dropdown, select Edit. 
  5. Select Next until you reach the Tax details window. 
  6. In the State W-4 details section, select Additional state taxes. Select the appropriate Wage Plan Code.
  7. Select Next, then select Done. 

Note: A wage code must be entered for all employees, even if they are inactive.

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