What is CASDI

[Harvey Lucas]

What is CASDI and where does it go on the 1040?

My client works in California, in box 14 of his w2 there is an entry for CASDI $635.

My understanding is that this is related to some sort of state industrial disabilty coverage and that he is allowed to claim it as a deduction on sch A line 8 other taxes.

I assume I would enter it there and lablel it CASDI.

Is this correct?

Thank You,
Harvey Lucas

[myerstaxes]

CA SDI = Disability Insurance

Hi,

CA SDI is the State Disability Insurance...If you enter it into the W2 screen as local taxes and code it as CA SDI, it should flow through to the State Taxes part of the Schedule A automatically...

[S T]

Over Limit

From your post it would appear that the employer collected too much CA SDI from the employee.

The State Disability Insurance (SDI) withholding rate for 2007 is 0.6%. The taxable wage limit is $83,389 for each employee per calendar year. The maximum to withhold for each employee is $500.33.

The employee will need to request the overpayment from the employer. Calif will refund through the tax return any amount over $500.33 (in 2007) if the overage is due to multiple employers.

I would deduct on the Sched A only the maximum amount of $500, not the actual $635 on the W-2 form.

Sandy

[Harvey Lucas]

Thank You

The 07 amount was 500.33.

When I posted I was looking at the 06 amount which was $635.

Would it improper to put it on Sch A line 8 and label it CASDI instead of it simply being included in the Sch A line 5 amount?

I would like it to be on line 8 so that the line 5 amounts are purely state and local income taxes and nothing else.

The CASDI does not seem to be an "income tax", so to me, it seems logical that a line 8 deduction would be proper.

Agreed?

Harvey Lucas

[myerstaxes]

Are You Filing a CA Return?

Thanks for noticing the overage in the SDI...I missed that! LOL
Now, if you are filing a CA return, if this does not flow through to the State Taxes Line 5, then it will flow through to the CA return...SDI is not an itemized deduction for CA purposes...Why not just put it as a State Tax as it should be treated for CA? I am thinking if you put it elsewhere, it will be claimed as a deduction on the CA return...Anyway, we treat it as a State tax, which it is in CA...

Chime in other CA preparers if I am misunderstanding the SDI treatment...

[tilt53]

It is a mandatory state tax so it really belongs on line 5. I suppose you could break it out on line 8 if you have to. Depending on your software (I use Proseries) you can enter the info on your W-2 worksheet. In ProSeries, go down to the entry for line 14, enter CASDI, the amount and it will fill in and flow to Sch. A line 5.

[joanmcq]

Every software I know puts it on line 5 with all the other state taxes. That's where I put it too. Why get fancy? That's where it goes!

[JG EA]

But not CAVDI Right?

Thanks ST!

[S T]

CA VDI or VPDI

Right JG,

These are voluntary plans by the employers (they opted out of the CA State Plan), and are not a state income tax deduction.

Sandy