Washington Cares Payroll Tax

At-A-Glance:

• The Governor has instructed the Employment Security Department to Delay assessments and collections through April 2022.
• Governor Inslee also strongly encourages employers to pause collecting premiums to allow the legislature time to make adjustment to the law.
• Lawmakers have proposed delaying the law implementation of the program until 2023.

Introduction

Washington Governor Jay Inslee announced today his intention to support the state legislature in delaying the implementation of Washington’s new Long Term Care Tax or better known as Washington Cares, which was set to go into effect on January 1, 2022. The Governor has instructed the Employment Security Department not to collect premiums from this program from employers before they become due in April and has instructed the department not to subject employers to penalties or interest for failure to collect premiums from employees.

Washington Governor and Top Legislators Provide Joint Statement

On December 17, 2022, Washington Governor Inslee along with State Senate Majority Leader Andy Billing and State House Speaker Laurie Jinkins, announced a delay in the Washington CARES Fund premium assessment until July 1, 2023.

The Governor indicated that discussions with State Legislators has been ongoing and the consensus among them indicates adjustments to the legislation are needed. As a result, the Governor has instructed the Washington Employment Security Department to suspend collections of the premiums until April allowing legislators to make the necessary corrections at the beginning of the 2022 legislative session.

In addition, the Governor has instructed the Department not to subject employers to penalties or interest for not withholding the fees from employees. The Governor further added, that although he can delay the premium assessment, he can only strongly encourage employers to delay collecting the premiums from employees until the legislature can make the necessary corrections to the law.

Next Steps

Paylocity is currently evaluating the impact of this announcement and additional communication will be provided in the coming weeks as we continue to monitor developments.

Thank you for choosing Paylocity as your Payroll Tax and HCM partner. This information is provided as a courtesy, may change and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney or Advisor.