Payroll binders and a hard hat on a desk, Washington WA Cares Fund

Washington WA Cares Fund: 0.58% Premium on All Wages, Exemptions and Self-Employed Opt-In

Washington WA Cares Fund: 0.58% Premium on All Wages, Exemptions and Self-Employed Opt-In

If you employ anyone in Washington, or you work here for wages, the WA Cares Fund affects your paycheck. The wa cares fund is Washington's state long-term care benefit program, paid for by a premium of 0.58% on gross wages. This guide covers who pays it, what employers must do, which workers can be exempt, and how self-employed people can opt in. It is written for business owners who run payroll and for workers who want to know where the deduction goes.

Informational content, not legal or tax advice. This guide summarizes Washington rules as of October 2026. It does not decide whether you or your employees qualify for an exemption or opt-in. The Employment Security Department (ESD) and the WA Cares Fund make those decisions. For complex situations, such as multistate employees, mixed self-employment and wage income, or a pending exemption, talk with a qualified attorney or CPA.

What the WA Cares Premium Is

The premium is 0.58% of an employee's gross wages. Social Security tax stops once wages pass an annual wage base. The WA Cares premium has no Social Security wage cap, so every dollar of gross wages is counted.

For a quick check, a worker with $1,000 in gross wages in a pay period has $5.80 withheld for the WA Cares premium ($1,000 × 0.58%). A worker earning $60,000 in gross wages across the year pays $348 in premium. These figures are simple arithmetic from the 0.58% rate, so they are only as accurate as the wage figure you start with.

Employers report wages and premium amounts to ESD each quarter through the Paid Family and Medical Leave (PFML) reporting process. Ask your payroll provider whether its PFML reporting covers the WA Cares premium, and confirm your exact reporting steps with ESD before your first quarterly filing.

Who Pays: The Employee, With an Optional Employer Share

The employee pays the WA Cares premium. The employer pays no share unless it chooses to cover some or all of it. If you decide to cover part of the premium, put that decision in writing in your payroll policy, and confirm with ESD how an employer-paid share is reported.

Employer Duties

  • Withhold the 0.58% premium from each covered employee's gross wages.
  • Report wages and premiums to ESD each quarter through PFML reporting.
  • Stop withholding once the employee gives you an approval letter from ESD.
  • Keep copies of exemption approval letters and any written participation elections in each employee file.
  • Ask for the approval letter itself, not just a verbal statement that an exemption applies.

Exemption Routes for Workers

Each exemption route runs through ESD. The worker applies to ESD and, once approved, gives you the approval letter. You then stop withholding. Requirements and documents differ by route, so the worker should confirm the steps on the WA Cares Fund site or with ESD before you change payroll.

Exemption routeWho it covers
Living outside WashingtonWorkers who live outside the state
Active-duty service memberService members who hold an off-duty civilian job
Spouse or registered domestic partnerThe spouse or registered domestic partner of an active-duty service member
Veteran with a service-connected disabilityVeterans with a 70 percent or higher service-connected disability rating

The exemption belongs to the worker, not the business. Your job is to act on a valid approval letter, not to decide whether someone qualifies.

Automatic Exemption for Non-Immigrant Work Visa Holders

Starting January 1, 2026, holders of non-immigrant work visas are automatically exempt from the WA Cares premium. They stay exempt unless they tell the employer in writing that they want to participate. In practice, check visa status during onboarding, do not withhold from visa holders by default, and keep any written election a visa holder gives you. If a worker later asks to join, the written request is what starts withholding, so file it in their record.

Private Long-Term-Care Exemption

A worker who received a private long-term-care exemption earlier keeps it permanently unless the holder cancels it. Cancellation is possible only between January 1, 2026 and June 30, 2028. A worker who wants to change that status must act inside that window. Confirm the cancellation steps with the WA Cares Fund, because the choice belongs to the exemption holder, not to your business.

Self-Employed Opt-In

Self-employed people are not covered automatically, but they can elect coverage. The rules set two timing points: an election could be made by June 30, 2026, or within three years of first becoming self-employed. As of October 26, 2026, the June 30, 2026 date has passed, so if you are self-employed now, the three-year window tied to your start date is the one to check. Because the answer depends on when you first became self-employed, check the fund's opt-in page for your situation and confirm with the WA Cares Fund before you assume you are eligible or ineligible.

Many self-employed people in Washington operate as sole proprietors or general partnerships. These do not file formation documents with the Secretary of State, so there is no state filing that records when your self-employment began. Keep your own dated records, such as the start date of your business activity and your business license and tax records, so you can show the timeline if asked. If you own an LLC, confirm with the fund whether you count as self-employed for WA Cares purposes.

How WA Cares Fits Your Business Setup

Washington has no personal income tax and no corporate income tax. Its main business tax is the state business and occupation (B&O) tax, a gross receipts tax with more than 50 activity classifications and no deduction for labor, materials or other costs. About 54 cities add their own B&O tax, which the Department of Revenue does not administer. The WA Cares premium is a payroll deduction separate from B&O, so it does not replace or reduce any B&O tax you owe.

If you plan to hire employees within 90 days, you need a state business license. Apply through the Department of Revenue's Business Licensing Service (BLS), which issues your 9-digit Unified Business Identifier (UBI). Corporations and LLCs must file with the Secretary of State before submitting the Business License Application. Set up your payroll and PFML reporting during the same planning window so your first paycheck is handled correctly.

Action Checklist

  1. Confirm the 0.58% rate and the WA Cares and PFML settings in your payroll system with your payroll provider.
  2. Decide whether you will cover any share of the premium, and document that decision in writing.
  3. Collect visa status information and any written participation elections at onboarding.
  4. For every exemption claim, request the ESD approval letter and file it before changing payroll.
  5. Stop withholding only after the approval letter is in hand.
  6. If you are self-employed, check the fund's opt-in page and calendar the three-year window from your start date.
  7. Talk with a CPA about payroll tax treatment, and with an attorney about any multistate or unusual situation.

Official Resources

Keep exploring: related Washington guides