Long-Term Care Tax delayed

Feb 3, 2022
Written by WR Communications

Gov. Jay Inslee signed two bills into law Thursday that delayed implementation of the Washington Long-Term Care Trust Act and expanded the number of people who can request permanent exemptions one day after the Senate approved the legislation. The bills were passed by the House last week.

The new payroll tax took effect on January 1, 2022, to fund the Washington Cares Fund, intended to provide financial assistance for long-term care.

Over the past year, unions, and employers, including the Washington Retail Association, communicated about several significant issues over eligibility requirements to collect benefits and the new payroll tax.

Although several bills to reform the long-term care program had been introduced, HB 1732 and HB 1733 were heard in the House Appropriations Committee. HB 1732 delays implementation of the program for 18 months (until July 2023.) HB 1733 adds new exemptions for disabled veterans, military family members, employees who hold a nonimmigrant visa for temporary workers, and non-state residents working in Washington State. Granted exemptions will be discontinued, and the employee will begin paying premiums if their basis for exemption has changed.

HB 1732 requires any employer that withheld the payroll tax beginning January 1 to remit the withheld amount back to their employees within 120 days. ESD is required to return any amounts remitted back to the employer within 120 days.