Am I Required to Register as an Employer?
If you operate a business and employ one or more employees, you must register as an employer with the Employment Development Department (EDD) when you pay wages in excess of $100 in a calendar quarter. If you are a household employer of one or more household workers, you must register with the EDD when you pay cash wages of $750 or more in a calendar quarter.
Employers who operate a business can be a person or a legal entity and include:
- Sole Proprietors
- Nonprofit and Charitable Organizations
- Limited Liability Companies
- Limited Liability Partnerships
- Public Entities (including state and federal agencies)
- Associations and Trusts
- Joint Ventures
- Indian Tribes
Household Employers who hire household workers can be:
- Private Households
- Local College Clubs
- Local Chapters of College Fraternities or Sororities
Generally, a business becomes subject to state payroll taxes upon paying wages over $100 in a calendar quarter to one or more employees. Wages consist of compensation for services performed, including cash payments, commissions, bonuses, and the reasonable cash value of noncash payments (like meals and lodging) for services.
Once subject, an employer must register with the EDD within 15 days of becoming a subject employer.
Examples of when a business becomes subject:
- A sole proprietor hires an employee during the month of March at a wage of $75 per month. The employer is subject effective April 1 since the employer did not pay the employee over $100 during the first quarter of the year (January-March) but will pay over $100 during the second quarter (April-June).
- A corporation operates without any employees except for the corporate president. The corporation is an employer and is required to register if the corporate president is paid wages of over $100 in a calendar quarter.
- A two-person partnership operates a business in which each partner draws a salary of $1,000 during the first quarter of the year. When one partner goes on vacation, an employee is hired and paid $95 during the quarter. The partnership is not required to register as an employer since partnership draws are not considered wages and the employee who was hired did not receive wages of over $100 in the calendar quarter.
Obtain more information about wages, subject wages, and personal income tax wages from the following:
A household employer must report when he/she employs one or more individuals to perform work and pays cash wages of $750 or more in a calendar quarter. You must register with the Employment Development Department (EDD) by submitting a Employers of Household Workers Registration and Update Form (DE1 HW) within 15 days after you pay $750 in total cash wages. Register online using e-Services for Business.
For more information, visit the Household Employer page.
Select your business type below to determine what information you will need to successfully complete your registration application.
- Commercial Employers-Individual Owners, Co-Ownerships, General Partnerships
- Commercial Employers-Corporations, Limited Liability Company (LLC), Limited Liability Partnerships (LLP), Limited Partners (LP)
- Employers of Household Workers
- Non-Profit Employers
- Agricultural Employers
- Church and Religious Order Employers
- Disability Insurance Elective Coverage (DIEC)
- Public Entity Employers
- Employers Depositing Only Personal Income Tax (PIT Only) Withholding (Including Payers of Pensions and Annuities)
- Public School Employers
- Indian Tribe Employers
Use e-Services for Business to register for your employer payroll tax account number. It’s fast, easy, and secure, and available 24 hours a day, 7 days a week.
- Create a username and password.
- Go to e-Services for Business.
- Select the “Enroll” box.
- Enter the required information and select “Continue.”
- Select the verification link in the email sent to you by the EDD to complete the enrollment process.
Important: If you do not verify your email address within 24 hours, you will need to restart the enrollment process.
- Select “New Customer”.
- Select “Register for Employer Payroll Tax Account Number.”
- Complete the online registration application.
- Select “Submit.”
This process will create an employer payroll tax account number.
Once you have registered your business with the EDD, you will be issued an eight-digit employer payroll tax account number (example: 000-0000-0), also known as a State Employer Identification Number, SEIN, or state ID number. Your employer payroll tax account number is required for all EDD interactions to ensure your account is accurate.
You must provide your employer payroll tax account number when filing returns and making deposits in all electronic and paper filings. If an agent, bank, or payroll service prepares your return they must also include your employer payroll tax account number when filing on your behalf.
- Report wages paid to your employees and State Personal Income Tax (PIT) withheld from their wages.
- Pay Unemployment Insurance (UI) and Employment Training Tax (ETT) on your employee’s wages, as well as withholding and remitting State Disability Insurance (SDI) and Personal Income Tax (PIT) due on wages paid to your workers (see Rates, Withholding Schedules, & Meals and Lodging Values).
- Report all new employees to the New Employee Registry within 20 days of their start-to-work date.
- If you use the services of independent contractors, you may also have to report them. Refer to Independent Contractor Reporting.
- You are required to post notices in your workplace and to provide your employees with benefit information. Refer to Required Notices and Pamphlets.
- Beginning January 1, 2017, employers with 10 or more employees will be required to electronically submit employment tax returns, wage reports and payroll tax deposits to the EDD. All remaining employers will be subject to this requirement beginning January 1, 2018.
For more information, visit:
e-Services for Business is your fast, easy, and secure way to manage your employer payroll tax accounts online.
- Register for an employer payroll tax account number.
- File returns/reports.
- Make payments.
- View, adjust, and print returns/reports previously filed online.
- View and update account information.
For more information or to enroll, visit e-Services for Business.
Encourage your employees to withhold the correct amount of state income tax by having them fill out a California Employee’s Withholding Allowance Certificate (DE 4) in addition to the federal Form W-4. An online calculator is available to assist in the completion of the DE 4. California Withholding Schedules are available on the Rates & Withholding page.
If you are a corporate officer and the sole shareholder (or the only shareholder other than your spouse) of a private corporation, you can elect to be excluded from State Disability Insurance coverage for benefits and contributions; see the Sole Shareholder/Corporate Officer Exclusion Statement (DE 459).
If you have already registered online, do not use this alternate method.
Include your Federal Employer Identification Number (FEIN) on the registration form to ensure unemployment insurance tax credits apply correctly when claimed on your Employer’s Annual FUTA Tax Return (IRS Form 940). For information on federal filing requirements, contact the IRS.
Complete the registration form for your type of business:
- Commercial Employer Account Registration and Update Form (Including Pacific Maritime, and Fishing Boats) (DE 1)
- Agricultural Employer Account Registration and Update Form (DE 1AG)
- Governmental Organizations, Public Schools, and Indian Tribes Registration and Update Form (DE 1GS)
- Nonprofit Employers Registration and Update Form (DE 1NP)
- Employers Depositing Only Personal Income Tax Withholding Registration and Update Form (DE 1P)
- Employer of Household Workers (DE1HW)
Mail or fax your completed registration form to the address or fax number below.
Employment Development Department
Account Services Group, MIC 28
PO Box 826880
Sacramento CA 94280-0001
Note: Registration by mail may take 10-14 days to process.
- E-file and E-pay Mandate for Employers
- CalGOLD – Business Permits Made Simple
- Striking Gold in California – What You Need to Know About Taxes and Your Small Business.
- California Tax Service Center – Guiding Taxpayers to the Forms and Services They Need
- Payroll Tax Seminars – No-fee seminars to assist employers in complying with California’s payroll tax laws.
- Changes to Your Business
- Required Filings and Due Dates
For assistance, call the Taxpayer Assistance Center at 1-888-745-3886 or visit your local Employment Tax Office.