Severance and SUI/SDI California deductions

[xdragox]

What is the name of your state? CALIFORNIA

I just received my first severance check from being laid off and there is State Unemployment Insurance and State Disibility Insurance deducted. Should they be deducting these categories since they do not recognize me as an employee anymore and I am currently collecting unemployment?

 

[pattytx]

I could address the SDI deduction (SUI is not deducted from the employee in California), but the bigger question here is, have you reported the severance pay as income when you file your weekly/biweekly UI claim? With very few exceptions (only one I can think of, that being a very small severance amount), you are not eligible for UI benefits if you are receiving severance pay for the same period.

 

[xdragox]

It has been reported and in California you can get Unemployment while collecting Severance Pay.

I do not understand why either Disibility or Unemplyment Insurance would be taken from the check as I am not employed by the company.

 

[pattytx]

I found the cite and I stand corrected. This IS unusual.

OK, then for why they are deducting SDI from your severance payments, because, generally speaking, they are subject wages. See page 33 of the Employer's Tax Guide here:
http://www.edd.cahwnet.gov/taxrep/de44.pdf

And, before you ask, here's the link to the CUIC, Section 1265:
http://www.leginfo.ca.gov/cgi-bin/displaycode?section=uic&group=01001-02000&file=1251-1265.9