What Is CA OASDI/EE on My Paycheck?

Paycheck deductions represent amounts withheld from gross earnings for different purposes, impacting net take-home pay. This article clarifies one common deduction, particularly for those working in California.

Decoding “OASDI/EE”

OASDI stands for Old-Age, Survivors, and Disability Insurance, representing a federal payroll tax. This deduction is specifically designed to fund the Social Security program, providing a safety net for millions of Americans. The “EE” suffix indicates that this particular contribution is the employee’s portion of the tax. Employers also contribute a matching amount, but the “EE” on your paystub refers solely to your share.

The fundamental purpose of this federal deduction is to provide financial security through future benefits.

The California Context

While OASDI is a federal tax, the “CA” prefix on your paystub signifies that your employment is based in California. This prefix helps differentiate state-specific deductions from federal ones. California has its own distinct state payroll taxes, which are entirely separate from the federal OASDI program. These state contributions primarily include State Disability Insurance (SDI) and Unemployment Insurance (UI).

California’s SDI program provides partial wage replacement benefits to eligible workers unable to work due to a non-work-related illness, injury, or pregnancy. Unemployment Insurance provides temporary income support to workers who lose their jobs through no fault of their own.

How Contributions Are Calculated

The employee portion of federal OASDI is calculated at a rate of 6.2% on wages up to an annual wage base limit. For 2024, this limit was $168,600, meaning any earnings above this amount are not subject to the OASDI tax. The Social Security Administration announces this wage base limit annually, and for 2025, it increased to $176,100. This ensures that contributions are proportional to earnings up to a certain threshold.

California SDI contributions are also mandatory deductions, though their calculation method has recently changed. For 2024, the California SDI rate is 1.1% of all wages. Notably, effective January 1, 2024, the state eliminated the annual wage base limit for SDI contributions, meaning all taxable wages are subject to this 1.1% rate.

Benefits from Your Contributions

Federal OASDI contributions provide several types of benefits designed to offer financial protection. These include retirement benefits, which are the most commonly known, providing income to eligible individuals in their later years. The program also offers disability benefits to workers who become severely impaired and are unable to engage in substantial gainful activity. Additionally, survivor benefits are available to eligible family members, such as a spouse or minor children, after a worker’s death.

California State Disability Insurance (SDI) contributions fund benefits for short-term wage replacement. This primarily covers individuals who are temporarily unable to work due to a non-work-related illness or injury, including pregnancy. The SDI program also encompasses Paid Family Leave (PFL), which provides benefits for bonding with a new child or caring for a seriously ill family member. Unemployment Insurance (UI) benefits provide temporary financial assistance to eligible workers who have lost their jobs through no fault of their own while they seek new employment.