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Arizonaworking inCalifornia
Reciprocity — home state withholds for you

California

Work State Tax Rate
1%-13.3% (highest in the nation)
Withholding Starts
After $1,500 in income
Law Last Updated
Oct 1, 2025

Employee Obligations (Which Returns YOU Must File)

Arizona has a reciprocity agreement with California. If your only income from California is wages, salary, tips, or commissions, file your Arizona return only — no California return needed. Give your California employer your reciprocity form (WEC) each year.

Employer Obligations (What Your Employer Must Withhold & Remit)

Reciprocity applies. If the employee provides the reciprocity form (WEC), withhold Arizona tax instead of California tax. Must still register for California unemployment insurance. Register for withholding, unemployment, and Employment Training Tax. Must withhold employee SDI/PFL contributions. Unemployment is 1.5%-6.2% on the first $7,000. Employment Training Tax is 0.1% on the first $7,000.

City & Local Income Taxes (Extra Filings Beyond the State Return)

No California city charges individuals an income tax. San Francisco's payroll and gross receipts tax is employer-level only.

Other Paycheck Deductions (Disability, Paid Leave, Unemployment)

State Disability Insurance (SDI) at 1.2% of entire salary with no cap. Covers disability and paid family leave.

Reciprocity Agreement — File Home State Only for Wages

Arizona has a reciprocity agreement with California. For wage income, you only need to file your Arizona return. Give your employer the reciprocity form (WEC) each year to avoid California withholding.

Row last reviewed: Apr 17, 2026Home state credit form: Form 309

This is general information, not tax or legal advice. Laws change frequently. Always consult a licensed CPA or tax attorney for your specific situation. All information researched as of March 21, 2026.