California Payroll Filing Using W-4 and DE 4
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California Payroll Filing Using W-4 and DE 4

No one wants too much income tax taken out of their pay by their employers and given to the state of California. The forms used in the state, W-2 and DE 4, give workers options for paying their taxes. Employers need to know both.

Calculating personal income tax (PIT) withholding is done using both the federal W-4 form and the California DE 4 form. Workers work with their employers to make sure the payroll tax filing is done right.

When the employer files the right form, or forms, pay for the work done on the job, and the tax taken out of the paycheck, both add up right.

The Federal W-4

The federal W-4 is the main form California employers use to file their workers' payroll taxes. Typically, an employer must use the marital status and withholdings a worker claims on their W-4 form to calculate the PIT withholding. By using the W-4 form, the California taxes and the federal taxes match. Most Californians do not have a reason to replace their federal claims with ones just for their state taxes.

When a worker files EXEMPT on the W-4 form, no California PIT wages are withheld.

The California DE 4

But, the W-4 does not fit every California workers' situation. For some workers, not everything falls into place. California has a Head of Household status that is not on the federal tax form. Employers that have a worker that wants to claim the Head of Household status need to use the state DE 4 form. If either the status claim or the allowances claim the worker makes for state taxes is not the same as the one they made for federal taxes, the employer needs to use the state form.

The DE 4 filing can not be avoided when a worker has a different number of allowances for the state personal income tax. Workers that itemize their California deductions can have a greater number of allowances. The filing simply has to fit the situation. Spouses of military servicemen or servicewomen that want to exclude their wages from California PIT withholding because they do not come from the state, and have a domicile in another state, but live with the servicemember who lives in California on military orders have to use the DE 4.

Voluntary DE 4 Filing

Employers can choose to use DE 4, or not. Either form can be the best choice for the payroll accounting. But, when a worker uses the DE 4 form, the employer must use it to calculate the state PIT withholding amount. The worker decides how much tax to pay in.

Payroll Taxes One By One

Each California worker has their own personal income tax goals. Employers meet with each one to decide the right filing.


California Employment Development Department, California Employers Guide 2011 (Internet, January 2011).

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