This is a reminder that effective July 1, 2023, you will need to deduct the 0.58% WA Cares long-term care premiums from employees’ wages the same way you do now for Paid Family Medical Leave (PFML).
The Employment Security Department will administer this program and will collect the premiums just as it does with PFML. The PFML system you have been using to report quarterly has been updated so you can report for both PFML and the WA Cares premiums at the same time.
Please note that unlike PFML the WA Cares premium contributions are not capped at the social security wage limit.
Exemptions from this tax are available for employees who had private long-term care insurance on or before Nov. 1, 2021, and applied for that exemption between Oct. 1, 2021, and Dec. 31, 2022.
Those exemptions are still valid, but the employee must provide you with the exemption approval letter they received from ESD. If they do not provide you with that letter you must withhold the WA Cares premiums from their wages.
Beginning Jan. 1, 2023, Washington workers became eligible for additional exemptions from WA Cares if any of the following apply to them:
- Live outside of Washington
- Are the spouse or registered domestic partner of an active-duty service member of the United States Armed Forces
- Have a non-immigrant work visa
- Are a veteran with a 70% service-connected disability rating or higher
Unlike the previous exemption pathway which had a deadline to apply, these exemptions became available on an ongoing basis beginning Jan. 1, 2023. The Employment Security Department is responsible for processing applications for those wishing to seek an exemption under these new categories. Exemptions will take effect the quarter after the application is approved.
Your payroll provider should be contacting you to request exemption letters shortly if they haven’t already. If they have yet to do so we advise requesting those letters from your employees now.
If you prepare your own payroll there will be updates for this new WA Cares premium in your payroll software. Be sure to keep an eye out for this update. Once updated you will need to go into each employee and add that tax to their payroll profile unless they are exempt.
More detailed information on this tax can be found at https://wacaresfund.wa.gov/
Questions? Get in touch with us today!
Contact us today if you have any questions about implementing this tax for your employees in your payroll software.
