Starting January, 2022, Washington State will begin collecting funding for the new Long Term Care Act. This is administered by the Employment Security Department. The employee paid premium will be a percentage of wages starting in January 1, 2022. This Long Term Care deduction is to start on the first January payroll regardless of when the hours were worked.
The percentage is 0.58%. Currently, we do not have any information if there is a maximum withholding amount per year.
There is no employer contribution, but employers are required to collect premiums through employee payroll deductions and remit proceeds to the Employment Security Department (EDS). This agency will deposit funds in a trust for the individual until they qualify for the benefit.
All qualifying employees are subject to the premium assessment, with the following exceptions:
- Individuals who have private long-term care insurance may opt-out: Any employee who attests that they have comparable long-term care insurance purchased before November 1, 2021, may apply to ESD for an exemption from the premium assessment. The employee must provide proof of their ESD exemption to their employer before the employer can waive collecting the premium assessment from the employee’s wages. The employee must apply for the opt-out exemption to ESD between October 1, 2021, through December 31, 2022.
- There may be additional employees who are exempted.
As of 12/23/2021, the WA state Governor said the deduction needs to be withheld from employee's paychecks even though the governor issued a statement that the collection by the state of the LTC benefit will be delayed.
For more information visit the Employment Security Department website.
The latest information from the Employment Security Department is Long Term Care is going to be reported along with PFMLA. It is recommended that the Long Term Care has the same vendor as PFMLA.
It is recommended to wait to add Long Term Care or change Long Term Care rates for the new year until after the last payroll of the current year is complete.
Go to: Payroll >Payroll Setup > Benefits & Deduction Plans tab
Click Add Plan
- Enter Plan Number- This is the sequence they appear on the screen. If left blank, the program will add the number automatically
- Enter the Type - Other
- Plan Name - Long Term Care or Wa State Long Term Care
- Double click the Vendor - select the same vendor used for PFML or PFMLA
- Make sure the Employee: Soc Sec Medicare FWT and W2 match what's shown below
- Participate: Choose Yes. This is an employee only deduction.
- Under the Employee: fields, enter .0058 for the decimal. This is the deduction for all employees.
- Click Add New on the right hand side to add employees to the deduction plan.
- Double click employee name field to add an employee to the deduction.
- Once all the employees have been added, click the Save button above the employees.
- Click the Save button on the Plans side.
The Long Term Care deduction should be in each employee's Benefits and Deductions section of their employee record. If you've already started a payroll period, please check the payroll benefits for each employee and add the Long Term Care deduction if needed. Be sure to check the deductions next payroll period to make sure the deduction is working as expected.
The Long Term Care deduction will be reported quarterly along with PFMLA. When running the benefit reports for regular payroll, uncheck Long Term Care from the list. See How Do I Create Long Term Care Reports? (The Create Long Term Care Reports help information will be available when information becomes available from the WA State Employment Security Department on how to report the Long Term Care deduction.