WA Cares Fund – Washington’s New Payroll Tax
Washington State is rolling out a new long-term care program in the form of a payroll tax. There is a short window for you to decide if you would like to automatically enroll in this program, or if you would like to seek an exemption. Below are the basics of the new program, along with steps that can be taken to apply for an exemption.
- New Payroll Tax
- Eligibility and Benefits
- Enrollment and Exemption
In 2019, Washington State enacted the Long-Term Services and Supports Trust Act, now referred to as the WA Cares Fund. The intent of this fund is to help pay for eligible long-term care related expenses. The current plan is set to provide eligible participants a benefit as much as $100 per day, and up to a lifetime benefit of $36,500. The WA Cares Fund will be funded through a payroll tax that is paid by Washington employees.
New Payroll Tax
Starting January 1, 2022, Washington Employers will begin payroll withholdings for eligible employees at a rate of $0.58 per $100 of earnings.
Eligibility and Benefits
According to the WA Cares Fund Benefits page, to be eligible to receive a benefit, an individual must meet the following criteria:
- Be a Washington resident.
- Be 18 years or older.
- Need assistance with at least 3 of the activities of daily living such as medication management, personal hygiene, eating, toileting, cognitive function, transfer assistance, body care, bathing, ambulation/mobility, or dressing.
- Meet work requirement, working and contributing for:
- Work at least ten years at any point in your life, and without a break of five or more years within those ten years.
- Three of the last six years at the time you apply for benefit AND at least 500 hours per year during those years.
Enrollment and Exemption
There is no enrollment for this program. All eligible employees in Washington will be required to contribute unless they have applied for a permanent exemption. To qualify for a permanent exemption, employees in Washington that are at least 18 years of age must purchase a qualifying long-term care insurance plan before November 1, 2020.