Beginning January 2022 all W-2 employees will be required to be taxed on ALL income to pay into the LTC trust. Washington's LTC trust comes with multiple limitations including but not limited to; having a $36,500 benefits lifetime limit, being limited to getting LTC in the state, and losing all benefits if relocation out of state is more than 5 years. LTC tax can and will likely go up in 2024 and LTC benefits can not be used until 2025.
There is an OPT OUT option. To opt out of the tax and LTC trust, an employee would be required to have secured a private LTC policy. Enrollments should be completed by November 1, 2021 to ensure coverage.
- Beginning January 1, 2022 each W-2 employee will pay a premium tax through payroll deduction
- All employees employed in Washington are subject to the tax
- An initial premium rate will be 0.58% of the individual's wages
- Maximum lifetime benefits are $36,500 per person
- Wages will be taxed without limitation or capped amount
- Employers are not required to contribute to the Program, though they are required to collect premiums from employees and remit them to Washington State ESD
- To opt out of the tax and LTC trust an employee would be required to have secured a private LTC policy NO LATER THAN July 24, 2021. Approved and Issued
- LTC policy owners will apply for exemption between October 2021 and December 2022
- Enrollments should be done by November 1, 2021 to ensure coverage
- No applications will be accepted after December 31, 2022
- Exempted employees are required to provide written notification to all current and future employers to notify them of their exemption
For additional information from the Employment Security Department of Washington State please view the following informational sheet:
Employment Securities WA Cares Fund
For continued state updates on the WA Cares Fund please visit the website linked below: