We are getting lots of questions about the state payroll tax for Long Term Care (LTC) – Washington “Cares Fund”. Our Union is gathering information to share with our members so you can make an informed decision. The law allows workers to request to opt out of the state program and associated payroll tax if they have private LTC insurance in effect before Nov. 1, 2021.
There has been some confusion between Long Term Care required this year through Washington State, and Long-Term Disability being offered as a voluntary benefit through Employee Benefit Systems. Long Term Care can be considered “Dignity Insurance”, which is typically needed after retirement during the last stages of life. While Long Term Disability could be defined as “Paycheck Insurance or wage protection”, which would protect a worker’s earning potential during working years, and coverage would end typically when employment ends, at or around typical retirement age.
Boeing is coming out with an alternative plan that would meet the requirements to allow a worker to opt out of the State payroll tax funding Washington’s Long-Term Care plan. Boeing is providing this as an option, which may be a better value than the state plan. However, the decision on whether to opt out and get Boeing’s plan or take the state plan is an individual decision. There are a lot of factors to consider including that the state plan is not portable so if you leave the state there is no benefit. You also need to consider your age, how long until retirement, and much more.
Even though our members at Boeing are excluded from the Washington State Payroll Tax this year due to being in a Collective Bargaining Agreement in effect on October 19, 2017, the Washington State Long Term Care law offers a one time opt-out where you must have an approved alternate plan in place before November 1, 2021. We will provide as much info as we can to help you make your decision, as it becomes available; however, we are still gathering information at this point. Boeing recently put out a couple articles in the Boeing News Now and an FAQ’s, which we are including so you can look at this information in case you missed it on the Boeing website.
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