What Happens During a Payroll Tax Audit in California?
The California Employment Development Department (EDD) is in charge of making sure businesses are paying their payroll taxes in California. They were set up to enforce the state’s payroll tax
The California Employment Development Department (EDD) is in charge of making sure businesses are paying their payroll taxes in California. They were set up to enforce the state’s payroll tax
As a California business owner, you have a lot of responsibilities. As such, receiving a notification of an EDD (Employment Development Department) audit is frustrating, but you shouldn’t ignore it.
When California’s Employment Development Department (EDD) audits your business, it can be a daunting and complex experience. When the EDD initiates a payroll tax audit, it is typically to ensure
Receiving notice of an audit from the California Employment Development Department can immediately raise concerns for any business owner. Don’t let an EDD audit catch you off guard. Instead, prepare
California’s Employment Development Department (EDD) can audit your company when one of your independent contractors tries to obtain unemployment benefits. This process can be costly and taxing, but you can
Ignoring a problem doesn’t make it go away, especially with the EDD. An EDD audit is a formal government investigation with the authority to impose back taxes, penalties, interest, liens,
As a business owner in California, it’s essential to be aware of the Employment Development Department (EDD). They’re the state taxing authority and the enforcers of California’s tax laws. Failure
In 2025, the Employment Development Department(EDD) in California has stepped up enforcement, and the most common spark for the audit is worker misclassification. What often surprises businesses is that these
Relying heavily on independent contractors instead of properly classifying workers as employees often leads to unpaid payroll taxes and missing benefit contributions, as well as a high risk of an EDD

Audits exist to ensure that employers are remaining compliant with the law. Find out the difference between verification and request EDD audits.