Where’s your paycheck going? We explain the new Washington Cares Fund tax

Washington workers’ paychecks are a little smaller after the state’s long-term care tax went into effect Saturday. On July 1, .58% of paychecks were deducted and added to the Washington Cares Fund.

People who want to use the funds will be able to use up to $36,500 towards in-home care. It’s a step in the right direction said long-term care professional, Ray, who works with Synergy Home Care. He also said it’s not enough to cover long-term care by a long shot.

“It’s a good start but in terms of how much care it provides at about eight hours a day, seven days a week, it’ll last about 12 weeks,” Ray said.

In-home care can come at a high price tag.

“At a rate of about $40 an hour, let’s assume someone needs help for 10 hours a day, that’s $400, $400 a day will go about 12 weeks. If they need less care it’ll go longer, less care per day,” Ray said.

The program is the first of its kind. Federal workers are exempt from the tax. Self-employed people and tribes can opt out of the program too.

While deductions started Saturday, funds won’t be available for 3 years. You also need to pay into it three of the last six years to get the full benefit. People born before 1968 can get partial benefits, 10% for each year they paid into the funds.

“It is a good start and it’s certainly better than nothing and it will help a lot of people,” said Ray.

People can also apply for exemptions. Active military spouses, temporary workers, people with permanent addresses in other states, and veterans with 70% or higher service-connected disabilities are eligible to opt out.

“I think that any program like that is a good idea. I wish that we had more robust programs but I think if you need it’s great. It’s better than nothing yet,” said Christina Lamborn, who lives in the state

The website where exemption applications are submitted does have a backlog. The website said anyone who applied before July 1 and still saw the deduction may have not had their paperwork processed yet. If the exemption is allowed, it will be backdated to July 1, but if back pay is available will be determined by the employer. For anyone who applied after July 1, their exemption will not go into effect till the next financial quarter.

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