California Payroll & Tax Compliance Update 2025

Powered by U.S. Tax Bay — Your Nationwide Payroll Partner

California continues to expand its tax and payroll requirements in 2025. Employers operating in the Golden State must stay on top of the latest developments to ensure compliance and avoid penalties.

🔹 Paid Sick Leave Expansion

California has increased its mandatory paid sick leave from 3 days to 5 days annually, effective January 1, 2025. All employers must update their policies and payroll systems to reflect this change.

🔹 Employment Development Department (EDD) Compliance

EDD is cracking down on misclassifications and late UI/SDI filings. Employers are encouraged to:

• Register promptly for state payroll accounts

• File UI and SDI reports on time

• Use accurate employee classifications

🔹 Why It Matters

California leads the nation in aggressive labor enforcement. Falling behind on payroll or tax requirements can lead to significant fines, audits, or legal action.

✅ How U.S. Tax Bay Can Help

At U.S. Tax Bay, we manage your payroll, tax filings, and compliance needs across platforms like ADP, Gusto, QuickBooks, Zenefits, and more. From SUI/SIT registration to W-2, 940/941 filings, we make sure you’re covered in California—and every other state you operate in.

📞 Let’s Get You Compliant

Start your California payroll setup today.

Visit www.ustaxbay.com or

email info@ustaxbay.com for a free consultation.