IMPORTANT UPDATE:
January 2022:
Gov. Jay Inslee, together with Senate Majority Leader Andy Billig and House Speaker Laurie Jinkins, recently announced an agreement to delay the new WA Cares payroll tax on employees as they address issues with the new long-term care program. In a statement, Inslee said:
“We need to give legislators the opportunity to make refinements to the new program before it kicks in. Therefore, I am taking measures within my authority and ordering the state Employment Security Department not to collect the premiums from this program from employers before they come due in April. My actions mean that the state will not collect those funds until the Legislature sorts through these issues. Pausing the program so that it can better serve disabled veterans, military spouses, non-residents, and near retirees will improve the program. A pause will also give the Long Term Care Commission the ability to study and make recommendations about residents who move out of Washington to retire and assure that those who have opted out of the program maintain their private insurance policies. These improvements will provide security and stability now and into the future for this critical safety net for our state’s seniors and people with disabilities.”
“During the pause, employers won’t incur penalties and interest for not withholding those taxes from worker wages,” Inslee added.
More details will be provided as this unfolds but for those that have not opted out of the payroll tax, the taxes will not be deducted at least during the first quarter.
Does this mean I can cancel my policy?
If you have purchased a policy and filed the opt-out exemption, you should keep your policy in place. The tax is likely to occur once the legislature refines the program. If you have attested to having a policy and then cancel the policy, if could be interpreted as tax fraud. Additionally, in all the task force committee meetings, there is discussion of the need for a recertification of your private coverage in the future to remain exempt from the payroll tax. The program is influx, but caution is advised.
Will the insurance carriers delay my premium?
No. You have purchased insurance and to keep it active, you will need to continue to pay the premiums. Additionally, if you had a claim event, the policy would pay you or your estate regardless of any WA Cares program.
Are they going to offer additional opt-out periods for those that were unable to purchase a policy prior to 11/1/21?
Nothing has been announced at this time.
Should I file my opt-out exemption if I have not yet and have a policy in place?
Yes. We encourage everyone with a qualifying policy to file the opt-out for when the payroll tax commences. For more information on opting-out visit: https://wacaresfund.wa.gov
IN SUMMARY
- The Payroll tax is on pause. The tax has NOT been eliminated or canceled. Just paused.
- You should NOT cancel your insurance policy because then you will not be allowed to opt-out when the tax is no longer paused.
- If you have not already Opted-Out you should do so now.
- There has been discussion that once you Opt-Out there may be a certification process to confirm that you have kept your private policy.
For More Information Visit: https://wacaresfund.wa.gov
Previous Communication
December 2021:
If you have purchased Long Term Care Insurance by Nov 1, 2021, you may opt-out of the WA Long Term Care Program. But you must apply for exemption. Click the button below for your next steps and see FAQ below.
FREQUENTLY ASKED QUESTIONS:
Unum Whole Life Policy – FAQ when will I get my policy number?
Response: Within 10-15 Business days, The policy number is not needed to apply for the exemption. The insured checks a box that attests that they have purchased an LTC policy as defined in RCW 48.83.020 prior to 11/1/21. They do not have to provide any policy information. Here is the link to the application: https://wacaresfund.wa.gov/apply-for-an-exemption/
How Long Do I have to file for the exemption, what are our next steps?
Response: Union members will have until 12/31/22 to file an exemption. However, it is best to file as early as possible in 2021. Once you file for an exemption, you will receive an approval letter from the Employment Security Department, and the employee has to give a copy of that letter to their employer so they can show they are approved to remove the income tax from their payroll. Until the employer receives the letter, they are instructed to charge the 0.58% tax.
The Washington Employment Security Department is promoting this page now for filing exemptions: https://wacaresfund.wa.gov/apply-for-an-exemption/
Can I still purchase Long Term Care?
Response: the EBS enrollment closed on 9/30, no further extensions were granted. You must purchase a private qualifying plan on or before November 1, 2021. There are companies out there that will sell individual Long Term Care.
What if I need help applying for the exemption?
The State of Washington has set up a toll free number for questions on exemptions and opting out of this tax as well as a website with more information , please direct the union member to these resources.
· Phone number from WA State is (833)717-2273