All employers required to e-file and e-pay with EDD in the new year

Beginning Jan. 1, 2018, employers of every size will be required to register with the Employment Development Department’s e-Services for Business and file all wage reports and employment tax returns and pay all contributions for unemployment insurance premiums electronically.

The electronic filing requirements of Assembly Bill 1245, signed into law by Gov. Jerry Brown in August 2015, are intended to increase the accuracy and security of data — through use of encryption — and improve the processing speed of returns and payments. Under AB 1245, employers must electronically file the following returns, reports and payments:

  • DE 9 - Quarterly Contribution Return and Report of Wages
  • DE 9C - Quarterly Contribution Return and Report of Wages (Continuation)
  • DE 3BHW - Employer of Household Worker(s) Quarterly Report of Wages and Withholdings
  • DE 3HW - Employer of Household Worker(s) Annual Payroll Tax Return
  • DE 3D - Quarterly Contribution Return
  • DE 88 - Payroll Tax Deposit

The initial phase of this mandate required employers with 10 or more employees to comply with the e-file and e-pay requirements beginning January 2017, as CDA reported last August. Phase 2 requires that all remaining employers comply by the Jan. 1, 2018, deadline.

Employers who for “good cause” are unable to submit reports and remit contributions electronically should complete and submit an E-File and E-Pay Mandate Waiver Request (DE 1245W). Employers may qualify for the waiver due to insufficient automation, for example, or severe economic hardship. Waiver requests can be submitted by fax to 916.255.1181 or by mail to:

Employment Development Department
Document and Information Management Center 
P.O. Box 989779
West Sacramento, CA 95798-9779

Employers will be notified by mail of the approval or denial of their waiver requests. Approved waivers will remain valid for one year. Once the annual waiver expires, the employer must remit reports and contributions electronically or apply for the waiver again to avoid noncompliance penalties. Penalties for noncompliance with the mandate range from 15 percent of the payroll tax deposit due to $20 per unpaid wage item to $50 per unpaid return.

E-filing, e-paying with EDD’s secure, no-cost service

Employers can use the EDD’s e-Services for Business system to comply with the e-file and e-pay mandate. The system lets users electronically submit returns and reports, make payroll tax deposits, register for an employer payroll tax account number and view, adjust or print returns and reports previously submitted online. Employers can enroll in and access the service on the EDD website.

For more information about this mandate, see the EDD’s FAQ page.

Related Items

In one handy place, CDA members can find the details, deadlines and resources they need to ensure their practice complies with upcoming laws and regulations. Check out “Are You in Compliance?” on the CDA Practice Support homepage.

The U.S. Citizenship and Immigration Services on July 17 released a new Form I-9, Employment Eligibility Verification. Practice owners who are hiring or planning to hire employees soon may continue to use the current version of the Form I-9 or may choose to use the new version of the form through Sept. 16, but must begin using the updated Form I-9 beginning Monday, Sept. 18.