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Spokane, Washington  Est. May 19, 1883

There’s still time to receive an exemption from Washington’s long-term care tax

Time is running out for residents to file for an exemption to the state's long-term care insurance tax.  (Getty Images)
By Laurel Demkovich Washington State Standard

A deadline to apply for exemptions from Washington’s controversial long-term care tax is upon us .

People who live outside of Washington but work in the state, spouses of active-duty military service members, those with nonimmigrant work visas and veterans with at least a 70% service-connected disability are all eligible for exemptions from the new payroll deduction.

But they’ll have to apply for carveouts by Thursday to ensure the money isn’t taken out of their paychecks when the tax goes into effect in July. Applications processed after July 1 will not go into effect until Oct. 1 because premiums are collected on a quarterly basis, according to the Employment Security Department.

As of last week, the department estimates more than 10,000 workers submitted exemption applications, but that 200,000 more are likely still eligible.

The new Washington Cares Fund has sparked disagreement since Gov. Jay Inslee signed it into law in 2019.

The program requires workers ineligible for exemptions to pay 0.58% of their income into the fund throughout their time working in Washington. Beginning in July 2026, those who qualify can begin accessing the benefit – up to $36,500 over their lifetime to help offset long-term care expenses. The payouts can be used for a number of services, such as professional care in-home or at a facility, equipment, caretaker training or meals.

Opponents raise concerns about the tax’s sustainability and the fact that people can only use the benefit in Washington, leaving out those who work here but move away during retirement.

But supporters say it will help hundreds of thousands of people afford long-term care, a growing cost for which many are unprepared.

The law was originally supposed to go into effect last year, but the Legislature pushed back tax collections following months of criticism. Last session, lawmakers passed four new exemptions to the program as well as delayed its start date to July 1 of this year.

To receive an exemption, those who qualify must apply online.

If approved, applicants must give their approval letter to their employer to ensure the tax is not deducted from their pay.

The Employment Security Department will continue processing applications after Thursday as quickly as possible, but it cannot guarantee they will go into effect before July.

“We’re encouraging eligible workers who want to apply for an exemption to continue sending in their applications after June 1,” Commissioner Cami Feek said in a news release. “Our goal is to process as many applications as possible before workers see their first paycheck deductions in July.”