Washington Paid Family and Medical Leave and Washington Cares Long-Term Care Insurance
Washington has implemented Paid Family, and Medical Leave and Washington Cares Long-term Care Insurance to assist employees with extended leave for illness and long-term care.
Background
The state of Washington offers statewide paid family and medical leave benefits to workers. This program is funded both by employees and employers. Most employers are required to participate in this insurance program. Employers can choose to use an employer-operated voluntary plan or the state plan.
For more information, see Washington State Employment Security Department’s website, Washington Paid Family and Medical Leave.
Patriot Software will calculate this tax for all payroll customers and collect, deposit, and file this tax for Full Service Payroll customers.
How much is the Washington PFML premium?
Here’s what you need to know:
- In 2024: the total premium rate will be 0.74% Employers will pay 28.57% and employees will pay 71.43%. For 2023: the total premium is 0.8%, shared by employers with over 50 employees (27.24%) and an employee rate of (72.76%).
- An employer can elect to pay the employee’s share of the premium.
- Employers with fewer than 50 employees working in Washington are not required to pay the employer portion of the premium.
- Premiums must be remitted quarterly during the month following each completed calendar quarter.
- Premium withholdings are capped up to the annual Social Security wage base.
- Tips are not included in gross wages.
Setting Up Washington Paid Family and Medical Leave Taxes in Patriot Software
As a new Patriot customer, you will need to answer a few questions in the payroll wizard. Existing customers can find these under Settings > Payroll Settings > WA Paid Family and Medical Leave.
Do you have fewer than 50 employees working in Washington?
If you have fewer than 50 employees, employers are not required to contribute the employer portion of the premium but may opt-in to become eligible for Small Business Assistance. You will still be required to collect and remit the employee’s share of premiums and meet reporting requirements. If you have 50 or more employees, you must contribute both the employer and employee share of the premium.
Do you want to pay a portion of your employees’ premium?
The employer can choose to pay more than their 27.24% share by paying some or all of the employee’s 72.76% contribution. You can change the employer contribution percent up to 100%, as long as the employer + employee = 100% of the 0.8% of wages.
As a recap, here are your options depending on your company size for the state insurance plan.
| Company Size | Employer Share | Employee Share |
|---|---|---|
| If less than 50 employees in Washington | Not required to pay the employer share of 27.24%, but can opt-in and get small business assistance | Required to withhold and collect employee share of 72.76% |
| If 50+ employees in Washington | Required to pay the employer share of 27.24%, can choose to pay more than this to cover employee share | Required to withhold and collect employee share of 72.76% |
Marking Exempt from Washington Family Leave Insurance
Company Exemption
If you are using the state insurance plan, nearly all employers are required to participate and are not exempt from Washington FLI. Exceptions are listed on the Washington Paid Family and Medical Leave website. You can mark your business exempt from the state plan under the Company Tax Exemptions page in the wizard. If you have completed the wizard, you will not be able to mark your company exempt, but you can change the answer to the questions at Settings > Tax Exemptions > Washington > Employer FLI.
Individual Employee Exemption
If an employee works primarily in Washington, even if they sometimes travel out of state, they are covered by Washington FLI. Employees are not required to be covered if they work in Washington for a short time. To mark an employee exempt, go to Payroll > Employee List > Select Employee Name > Advanced Tax Settings > Add FLI Exemption Status and change to “Exempt.” This will prevent the employee and corresponding employer’s share of tax from calculating for this particular employee.
Washington Cares Long-term Care Insurance
UPDATE: The Washington Cares payroll tax has been reinstated for July 2023.
Background:
You need to make an additional deduction from Washington workers’ paychecks for the Washington Cares Fund. The Washington Cares Fund is entirely employee-funded. And most employees must contribute to it. Under the new law, Washington workers will pay up to $0.58 per $100 of earnings (or 0.0058 X 100). Patriot calculates the Washington Long-term insurance tax and collects, deposits, and files the tax to the Employment Security Department for Full Service Customers.
The Washington Cares tax will automatically calculate for companies with employees in Washington. There aren’t any additional settings you need to select unless the employee has requested to be exempt from the state.
Once an employee requests an exception from the program, they are not eligible to receive Washington Cares benefits and cannot rejoin the program at a later date.
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