What California Form DE 9 Is For
California's Form DE 9, the Quarterly Contribution Return and Report of Wages, is the quarterly tax return that California employers file with the Employment Development Department (EDD). It reconciles what you paid during the quarter with what you owe. The form reports four types of payroll taxes: Unemployment Insurance (UI), Employment Training Tax (ETT), State Disability Insurance (SDI), and California Personal Income Tax (PIT) withholding.
The DE 9 works together with the Quarterly Contribution Return and Report of Wages (Continuation) (DE 9C), which lists each employee's wages. Together, these forms confirm that your payroll tax deposits match your payroll obligations for the quarter. Every employer with a California payroll tax account must file these forms every quarter, even if there was no payroll during the quarter. The wages you report on the DE 9C are used to credit your employees for unemployment and disability insurance benefits.
When You’d Use California Form DE 9
Regular Filing
You file Form DE 9 and DE 9C four times a year. The returns are due on April 1 (January–March), July 1 (April–June), October 1 (July–September), and January 1 (October–December). Each return is delinquent if not filed by the last day of the month after the quarter ends (April 30, July 31, October 31 and January 31). If that delinquent date falls on a Saturday, Sunday, or legal holiday, it moves to the next business day. California requires employers to file these returns electronically through EDD's e-Services for Business.
Late Filing
If you miss the delinquent date, EDD charges penalty and interest on the late report, plus a wage item penalty of $20 per employee for late reporting or unreported employee wages. If you still owe, EDD sends a Statement of Account (DE 2176).
Amended Filing
When you discover errors on a previously filed DE 9 or DE 9C, correct them with the Quarterly Contribution and Wage Adjustment Form (DE 9ADJ), either online through e-Services for Business or on paper. Corrections include wrong tax amounts, missing employees, incorrect wages, and incorrect wage plan codes.
Key Rules or Details for 2021
Electronic Filing Mandate
California law requires all employers to file the DE 9 and DE 9C electronically and to make all payroll tax deposits electronically. Filing a paper DE 9 without an approved waiver results in a noncompliance penalty of $50 per return, and a paper DE 9C results in a penalty of $20 per wage item. Employers who cannot file electronically can request an E-file and E-pay Mandate Waiver (DE 1245W); an approved waiver is valid for one year only.
Filing Required Even with Zero Payroll
You must file your quarterly returns even when you pay no wages during a quarter. If you do not have employees now but may in future quarters, file your DE 9 and DE 9C stating that you have no payroll to report; otherwise, EDD may presume you have employees and assess your account. Filing a paper return to report that no wages were paid results in a $50 noncompliance penalty.
Wage Reporting Timing
For reporting purposes, wages are taxable when they are paid (or constructively paid), not when employees earn them. If wages earned in one quarter are paid in the next quarter, report them in the quarter they were paid.
Tax Calculation Limits
Each payroll tax has its own wage limit. For 2021, UI and ETT apply only to the first $7,000 each employee is paid during the calendar year (not the quarter). Once an employee's wages for the year pass $7,000, you stop paying UI and ETT on that employee's wages. SDI has a 2021 taxable wage limit of $128,298 per employee, and the 2021 SDI withholding rate is 1.2 percent. PIT withholding has no wage limit and depends on the amount you withhold based on each employee's Form W-4 or DE 4.
Refunds and Credits
If your DE 9 shows that you deposited more than you owed, you have an overpayment. EDD cannot refund over-withheld SDI or PIT until you first credit or refund those amounts to your employees, because they are employee withholdings, not employer payments.
Step-by-Step (High Level)
Step 1: Gather Your Payroll Information
Before starting Form DE 9, collect your payroll records for the quarter: total wages paid to all employees, each employee's year-to-date wages (to determine which wages remain subject to UI and ETT), total SDI withheld, total PIT withheld, and records of every payroll tax deposit (DE 88) you made during the quarter.
Step 2: Calculate Taxable Wages for Each Tax Type
Determine your UI taxable wages by counting wages paid to each employee only up to $7,000 per employee per year. If an employee was paid over $7,000 earlier in the year, none of that employee's wages this quarter are UI taxable wages. Use the same calculation for ETT taxable wages. For SDI, total all SDI-subject wages up to $128,298 per employee for 2021. For PIT, report the wages subject to California income tax withholding.
Step 3: Calculate Your Tax Obligations
Multiply your UI taxable wages by the UI contribution rate EDD assigns to your business (new employers pay 3.4 percent for two to three years). Multiply your ETT taxable wages by 0.1 percent. Your SDI and PIT amounts should equal what you withheld from employee paychecks during the quarter. Add these amounts to get your total for the quarter.
Step 4: Reconcile with Your Deposits
Compare your total to the payroll tax deposits you made during the quarter. If you deposited more than you owe, you have an overpayment. If you deposited less, pay the balance. EDD charges a penalty of 15 percent plus interest on late payroll tax payments.
Step 5: Complete the DE 9C with Individual Employee Data
For each employee paid during the quarter, enter the Social Security number, name, total subject wages, PIT wages, PIT withheld, and wage plan code. EDD's Information Sheet: Reporting Wage Plan Codes on Quarterly Wage Reports and Adjustments (DE 231WPC) explains which code to use. The DE 9C totals must match your DE 9.
Step 6: File Electronically Before the Delinquent Date
Log in to e-Services for Business, choose the quarter, and enter your information. Submit both the DE 9 and the DE 9C before the delinquent date.
Common Mistakes and How to Avoid Them
Mistake: Forgetting to File When There's No Payroll
Some employers assume they can skip quarterly filings when they paid no wages. If you may have employees in future quarters, you must still file a DE 9 and DE 9C stating that you have no payroll to report, or EDD may presume you have employees and assess your account. If you no longer have employees and will not report wages in any future quarter, file a final DE 88, DE 9, and DE 9C and close your account in e-Services for Business.
Mistake: Filing Paper Returns Without a Waiver
Filing a paper DE 9 without an approved waiver results in a $50 penalty per return, and a paper DE 9C results in a $20 penalty per wage item, even if everything else is correct and timely. Register for e-Services for Business and use it for all filings. If you cannot file electronically, request a waiver (DE 1245W) before filing on paper.
Mistake: Reporting Wages in the Wrong Quarter
Report wages in the quarter they were paid, not the quarter they were earned. For example, if employees earned wages in late March but you paid them in early April, those wages belong on the second-quarter (April–June) return.
Mistake: Miscalculating Taxable Wage Limits
A common error is applying the $7,000 UI and ETT limit quarterly instead of annually. The limit is cumulative for the calendar year. For example, if an employee is paid $3,000 in the first quarter and $4,500 in the second quarter, only $4,000 of the second-quarter wages ($7,000 − $3,000) is subject to UI and ETT, and none of that employee's later wages that year is.
Mistake: Confusing Employee Versus Employer Tax Responsibilities
UI and ETT are employer-paid taxes, while SDI and PIT are withheld from employee wages and remitted to EDD. Withhold SDI and PIT from employee wages, then remit what you withheld.
Mistake: Failing to Reconcile Deposits Before Filing
Before finalizing your DE 9, compare your DE 88 deposits for the quarter with the amounts you are reporting. If there is a difference, find the cause before you file.
Mistake: Delaying Corrections
If you find an error on a previous return, file a DE 9ADJ or an adjustment through e-Services for Business for that quarter as soon as possible. Interest is charged on late payments until they are paid.
What Happens After You File
Balance Due Collections
If you owe more than you deposited, pay the balance through e-Services for Business. If payments are not made on time, EDD sends a Statement of Account (DE 2176) detailing the delinquent balance. If the balance is not paid, a state tax lien may be issued and recorded with the county recorder's office and the Secretary of State, where it becomes a matter of public record.
Wage Credit Posting for Employees
The employee wages you report on the DE 9C are used to credit your employees for unemployment and disability insurance benefits. Accurate and timely wage reporting protects your employees' benefit rights.
UI Tax Rate
Most employers' UI rates are set by the experience rating method. Each December, EDD mails the Notice of Contribution Rates and Statement of UI Reserve Account (DE 2088) showing your UI rate for the coming year.
FAQs
Do I need to file Form DE 9 if I'm a sole proprietor with no employees?
No. You become a subject employer when you pay wages over $100 during any calendar quarter to one or more employees. Once you do, you must register with EDD within 15 days and file the DE 9 and DE 9C every quarter. Paying independent contractors does not make you an employer for this purpose, but you must report independent contractors to EDD on the Report of Independent Contractor(s) (DE 542) within 20 days of paying $600 or more or entering into a contract for $600 or more, whichever is earlier.
What's the difference between Form DE 9 and Form DE 88, and which one comes first?
The Payroll Tax Deposit (DE 88) is how you pay UI, ETT, SDI, and PIT to EDD during the quarter. Depending on your federal deposit schedule and the amount of California PIT you have accumulated, SDI and PIT deposits may be due quarterly, monthly, semi-weekly, or next-day. The DE 9 comes afterward and reconciles those deposits with what you owe for the quarter.
If I discover I reported the wrong Social Security number for an employee on last quarter's DE 9C, how do I fix it?
File a Quarterly Contribution and Wage Adjustment Form (DE 9ADJ) for that quarter, either online through e-Services for Business or on paper, with the correct employee information. The DE 9ADJ instructions in the California Employer's Guide (DE 44) explain which sections to complete.
My business is seasonal and I only have employees for three months each year. Do I still need to file Form DE 9 in quarters when I have no employees?
Yes. If you do not have employees now but may have them in future quarters, file your DE 9 and DE 9C stating that you have no payroll to report every quarter; otherwise, EDD may presume you have employees and assess your account. If you will not report wages in any future quarter, file a final DE 88, DE 9, and DE 9C and close your account in e-Services for Business.
I made my payroll tax deposits on time throughout the quarter, but I'm going to file my DE 9 a few days late. Will I owe penalties?
Yes. Penalty and interest are charged on late reports even when your deposits were on time, and EDD charges a $20 wage item penalty per employee for late reporting or unreported wages. File both the DE 9 and the DE 9C electronically through e-Services for Business by the delinquent date.
Where can I get help?
Call EDD's Taxpayer Assistance Center at 1-888-745-3886, or see the California Employer's Guide (DE 44) at edd.ca.gov.
