Executive Summary

Key takeaways at a glance

SDI and PFML payroll deductions fund short-term wage replacement for non-work-related medical leaves.
California (1.1%), Hawaii (0.5%), New Jersey (0.09%), New York (0.5%), Rhode Island (1.1%), and Washington (0.74%) have mandatory rates.
California has fully eliminated its annual wage cap, taxing high earners at the 1.10% rate on all earnings.

What is State Disability Insurance (SDI)? Rates & Limits

4 min read Updated October 2026By Owen Seth

While federal taxes and standard state income taxes are widely understood, certain states impose an additional mandatory payroll deduction known as **State Disability Insurance (SDI)** or **Paid Family and Medical Leave (PFML)**.

What Does SDI Cover?

SDI is a state-mandated program that provides short-term wage replacement benefits to eligible workers who suffer a non-work-related illness, injury, or pregnancy-related medical condition that prevents them from performing their standard duties.

2026 SDI Rates & Annual Wage Limits

California (CA)

Rate: 1.30%. Has fully eliminated its wage base cap, taxing all wage levels.

Hawaii (HI)

Rate: 0.50%. Wage base capped at $61,214 for the year.

New York (NY)

Rate: 0.50%. Wage base capped at $89,835 for the year.

Washington (WA)

Rate: 0.74%. Dedicated PFML program for family medical leaves.

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