Fillable Printable Information Sheet: Nonprofit And/Or Public Entities (De 231Np)
Fillable Printable Information Sheet: Nonprofit And/Or Public Entities (De 231Np)
Information Sheet: Nonprofit And/Or Public Entities (De 231Np)
NONPROFIT ENTITIES
Nonprot entities are subject to Unemployment
Insurance (UI), Employment Training Tax (ETT), State
Disability Insurance* (SDI), and state Personal Income
Tax (PIT) withholding. However, nonprot entities
that have an exemption under Section 501(c)(3) of
the Internal Revenue Code (IRC) have a choice in
the method of nancing their unemployment costs. A
nonprot entity may elect to:
• Pay the same UI taxes under the same method as
commercial employers (experience rating method),
or
• Reimburse the state for the full cost of all UI benets
paid to their former employees (reimbursable
method).
To elect the reimbursable method, a nonprot
employer must le a Selection of Financing Method
by a Nonprot Organization (DE 1SNP), as well as the
Registration Form for Nonprot Employers (DE 1NP),
when registering. If the DE 1SNP is led at a later date,
it will be effective the rst day of the quarter in which it
is led.
Special Exclusions - Nonprot Entities
The following persons who work for religious, charitable,
educational, and other nonprot organizations
described in Section 501(c)(3) of the IRC are excluded
from UI and SDI coverage:
• Persons in the employ of a church or convention or
association of churches.
• Persons in the employ of an organization operated
primarily for religious purposes and which is
operated, supervised, controlled, or principally
supported by a church or convention or association
of churches.
• Duly ordained, commissioned, or licensed ministers
in the exercise of their ministry. (Also excluded from
PIT withholding.)
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NONPROFIT AND/OR PUBLIC ENTITIES
• Members of religious orders in the exercise of duties
required by such order. (Also excluded from PIT
withholding.)
• Persons receiving rehabilitation or compensative
work in a program conducted for rehabilitation of
persons whose earning capacity is impaired by age,
physical or mental deciency or injury.
• Persons receiving rehabilitation or compensative
work in a program providing compensative work
for persons who because of their impaired physical
or mental capacity cannot be absorbed in the
competitive labor market.
• Persons receiving work relief or work training in a
program nanced by any federal agency or agency
of a state or political subdivision thereof.
• Wards or inmates of a custodial or penal institution.
• Persons under the age of 18 years in delivery or
distribution to ultimate consumers of newspapers or
shopping news.
• Persons selling newspapers or magazines at a
xed price to ultimate consumers if compensation is
based on retention of the excess of sale price over
cost from supplier.
• Persons participating in a national service program
carried out using assistance provided under
Section 12571 of Title 42 of the United States Code.
• Persons performing services if the compensation is
less than $50 in a calendar quarter.
• Persons performing services as elected or appointed
ofcials in the employ of any nonprot fraternal
corporation or association if the remuneration does
not exceed $100 a month.
Nonprot entities that have an exemption under
Section 501(c)(3) of the IRC may elect coverage for UI
and SDI for exempt workers listed above, either for all
such workers or each specic type of worker.
For additional information on elective coverage refer to
Information Sheet: Specialized Coverage (DE 231SC).
*Includes Paid Family Leave (PFL).
PUBLIC ENTITIES
Public entities include:
• State of California
• County
• City
• District
• Public agency
• Public authority
• School district
• Community college district
• Instrumentalities of this state and one or more states
A public entity must withhold PIT and provide for UI
coverage through an experience rating method or
reimbursable nancing method.
The SDI withholding is not required but coverage
may be extended upon request under certain
circumstances. For additional information refer to
Information Sheet: Specialized Coverage (DE 231SC).
Special Exclusions - Public Entities
The following employees of public entities are excluded
from UI and SDI coverage:
• Elected ofcials (elected ofcials are not considered
employees of the government entity).
• Members of legislative bodies or the judiciary of a
state or political subdivision of a state.
• Members of the State National Guard or Air National
Guard, except persons who render such services as
regular state employees.
• Persons serving on a temporary basis in case
of re, storm, snow, earthquake, ood, or similar
emergency.
• Persons in positions designated as major
nontenured policymaking or advisory positions.
• Persons in policymaking or advisory positions whose
duties do not require more than eight hours per
week.
• Election ofcials and election workers who are
expected to be paid less than $1,000 for such
services during the calendar year.
• Duly ordained, commissioned, or licensed ministers
in the exercise of their ministry. (Also excluded from
PIT withholding.)
• Members of religious orders in the exercise of duties
required by such order. (Also excluded from PIT
withholding.)
• Persons receiving rehabilitation or compensative
work in a program conducted for rehabilitation of
persons whose earning capacity is impaired by age,
physical or mental deciency or injury.
• Persons receiving rehabilitation or compensative
work in a program providing compensative work
for persons who because of their impaired physical
or mental capacity cannot be absorbed in the
competitive labor market.
• Persons receiving work relief or work training in a
program nanced by any federal agency or agency
of a state or political subdivision thereof.
• Wards or inmates of a custodial or penal institution.
• Persons under the age of 18 years in delivery or
distribution to ultimate consumers of newspapers or
shopping news.
• Persons selling newspapers or magazines at a
xed price to ultimate consumers if compensation is
based on retention of the excess of sale price over
cost from supplier.
• Persons participating in a national service program
carried out using assistance provided under
Section 12571 of Title 42 of the United States Code.
Public entities may elect coverage for UI for exempt
workers listed above, either for all such workers or
each specic type of worker.
ADDITIONAL INFORMATION
For further information regarding requirements and/or
exclusions for nonprot and public entities,
please contact the Taxpayer Assistance Center at
888-745-3886 or visit your local Employment Tax Ofce
listed in the California Employer’s Guide (DE 44)
and on the Employment Development Department
(EDD) website at www.edd.ca.gov/Ofce_Locator/.
Additional information is also available through the
EDD’s no-fee payroll tax seminars. View the in-person
and online course offerings on the EDD website at
www.edd.ca.gov/Payroll_Tax_Seminars/.
The EDD is an equal opportunity employer/program.
Auxiliary aids and services are available upon request
to individuals with disabilities. Requests for services,
aids, and/or alternate formats need to be made by
calling 888-745-3886 (voice) or TTY 800-547-9565.
This information sheet is provided as a public service and is intended to provide nontechnical assistance. Every attempt has
been made to provide information that is consistent with the appropriate statutes, rules, and administrative and court decisions.
Any information that is inconsistent with the law, regulations, and administrative and court decisions is not binding on either the
Employment Development Department or the taxpayer. Any information provided is not intended to be legal, accounting, tax,
investment, or other professional advice.
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