1. What is SDI?

SDI (State Disability Insurance) is a payroll tax that provides short-term disability insurance to eligible workers. The calculation is based on a percentage of the employee's wages.

2. How Does the Calculator Work?

The calculator uses the SDI formula:

Where:

• \( Base\ Wage \) — Employee's gross wages
• \( 0.01 \) — Standard SDI rate (1%)

Explanation: The calculation is straightforward - simply multiply the base wage by 1% (0.01) to determine the SDI amount.

3. Importance of SDI Calculation

Details: Accurate SDI calculation ensures proper withholding for state disability insurance programs, which provide benefits to workers who are unable to work due to non-work-related illness or injury.

4. Using the Calculator

Tips: Enter the employee's base wage in dollars. The calculator will automatically compute the SDI amount at the standard 1% rate.

5. Frequently Asked Questions (FAQ)

Q1: Is the SDI rate always 1%?
A: While 1% is standard, rates can vary slightly by state and year. Always check current rates for your location.

Q2: Are there wage limits for SDI?
A: Yes, most states have a maximum taxable wage limit for SDI calculations.

Q3: Who pays SDI - employer or employee?
A: In most states, SDI is employee-paid through payroll deductions.

Q4: Is SDI the same as SDI tax?
A: Yes, SDI refers to both the insurance program and the tax that funds it.

Q5: Are all employees eligible for SDI?
A: Eligibility varies by state, but most W-2 employees are covered.