Do I file my short term disability payments for California?

[LindaS5247 · Accepted solution]

In California, short-term disability income is considered taxable at the state level. However, it is not subject to federal income tax.  So they would be included on your California State Income Tax Return as income.

SDI benefits are taxable only if paid as a substitute for unemployment insurance (UI) benefits. This could occur if a person was receiving UI benefits and then became disabled.

When SDI benefits are received as a substitute for UI benefits, the SDI is taxable by the federal government but is not taxable by the State of California.

Click here for additional information on the taxability of short-term disability payments.