I have 2 employers in 2020 in CA. One employer W2 has $779 CASDI which count into state tax deduction. Another employer has $1158 CAVPDI which does NOT count into state tax deduction. Looks like CASDI give tax deduction, but not CAVPDI.
I want to understand:
1. Did I withhold too much CA SDI + CAVPDI?
2. Why CAVPDI do not count as state tax deduction?
Thanks for your help
SDI: State Disability Insurance
VPDI: Voluntary Plan for Disability Insurance
1. Yes. There is a maximum of $ 1,229.09 for both, per person.
2. The VPDI and SDI both can have credit.
California SDI (or VPDI) withheld. A credit for excess SDI or VPDI applies if the taxpayer meets all of the following:
• Taxpayer had two or more California employers during 2020.
• Taxpayer received more than $122,909 in wages.
• The amounts of SDI (or VPDI) withheld appear on Form(s) W-2.
If SDI (or VPDI) was withheld from wages by a single employer, at more than 1% of gross wages, do not claim excess SDI (or VPDI) on Form 540. Contact the employer for a refund.
Generally, VPDI and/or SDI benefits are not taxable by the state of California or the IRS. The one case in which they may be taxed is when employees receive SDI benefits in place of unemployment compensation and for a person who is not eligible for Unemployment Insurance (UI) benefits only because of the disability.