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Washington Long Term Care Trust Act

Washington Long Term Care Trust Act

July 01, 2021

Today we wanted to share some info about the WA state LTC tax. 

If you're a resident of Washington, the passage of The Long-Term Care Trust Act, effective January 1, 2022, makes Washington the first state in the nation to create a publicly funded insurance program that will provide working residents of Washington an opportunity to vest into a basic level of LTC benefits. The program will be funded by Washington workers who will pay premium assessments (a tax) through payroll deductions. There is also a window of opportunity for residents who own “long-term care insurance” to apply for an exemption from the premium tax. Governor Inslee signed HB 1323 that allows individuals to purchase a LTC policy up until November 1, 2021.


  • Beginning January 1, 2022 each W-2 employee will pay a premium tax through payroll deduction.
  • An initial premium rate will be 0.58% of the individual’s wages (or $0.58 for each $100 earned).
  • Wages will be taxed without limitation or capped amount.
  • There is an option for self-employed individuals to elect coverage and be part of the program.
  • There is also a limited period for individuals who own “long-term care insurance” to apply for an exemption from the premium assessment (tax) – in other words, to opt-out of the program.
  • Benefits for approved services will become available starting on January 1, 2025.
  • Maximum lifetime benefits are $36,500 per person (adjusted annually) for vested individuals.

An “eligible beneficiary” of the program is a qualified individual who:

  1. Is age 18 years or older,
  2. Was not disabled before the age of 18,
  3. Meets the requirement for assistance with ADLs, and
  4. Has not exhausted their lifetime benefits.

Benefits will not be available to individuals who:

  1. Have already permanently retired, thus are unable to vest into the program.
  2. Have moved out of state for 5 or more years, are not residing in Washington state when qualified to receive benefits, even if vested in the program


An employee who attests they have “long-term care insurance” has the option to apply for an exemption from the premium tax. Note that once the employee is determined to be exempt, they may not later apply to become a qualified individual or eligible beneficiary – they are permanently ineligible for coverage under the program.

The employment security department will accept applications for the exemption only from October 1, 2021, through December 31, 2022.

Only employees aged 18 and older can apply for the exemption.

As the tax is assessed through payroll deduction, it is the responsibility of the exempt employee to provide written notification to all current and future employers of an approved exemption.

More info to follow next week on the different options....

Pacific Advisors LLC is an Agency of The Guardian Life Insurance Company of America (Guardian), New York, NY. Securities products & services are offered through Park Avenue Securities LLC (PAS) member FINRA, SIPC, 333 North Indian Hill Blvd. Claremont, CA 91711, 1-909-399-1100. PAS is a wholly owned subsidiary of The Guardian Life Insurance Company of America® (Guardian), New York, NY. Pacific Advisors LLC is not an affiliate or subsidiary of PAS or Guardian. Insurance Products offered through One Pacific Financial & Insurance Solutions LLC, a DBA of Pacific Advisors LLC. Pacific Advisors LLC is not registered in any state or with the U.S. Securities and Exchange Commission as a Registered Investment Advisor. CA Insurance License #0K12914 The Guardian Network (TM) is a network of independent agencies authorized to offer products of The Guardian Life Insurance Company of America® (Guardian) and its subsidiaries, and is not an affiliate or subsidiary of Guardian. This Agency is authorized to offer products of The Guardian Life Insurance Company of America® (Guardian), New York, NY and its subsidiaries. The GUARDIAN® Logo is a registered service mark of Guardian, used with permission.

The Washington State Trust Commission is solely responsible for approving exemptions from the .58% payroll tax. NFP makes no warranty or guarantee that a policy purchased will qualify for a payroll tax exemption from the Washington Long Term Services & Supports Trust Program. Material provisions of the Program are subject to future rule making and recommendations by the Washington State Legislature and members of the Trust Commission. Implementation and administrations of the Trust Program is an active collaboration between the Health Care Authority, the Department of Social & Health Services, the Office of the State Actuary, and the Employment Security Department. The information shared in this document is the best available information at the time of publication. This is a summary document, and is not financial, legal or tax advice. 

This publication is provided for informational purposes only. Guardian does not provide legal, tax, or accounting advice or specific recommendations on how to qualify or apply for the exemption. Consult your tax, legal, or accounting professional regarding your particular set of facts and circumstances. #2021-121502 Exp 5/23