What you need to know about the WA State Long-Term Care Trust Act in about 45 seconds…

The Act becomes effective January 1, 2022 for all W-2 employees in the state.

  1. The tax is .58 per $100 of gross income for all W-2s, including CEOs. There is no cap, so the more you make, the more you pay on an unlimited basis.
  2. The LIFETIME benefit is $36,500 per person. At today’s average monthly costs in Washington, that would last about 4 and a half months.
  3. The benefits can only be used in Washington. If you retire in Arizona or any other state or country, you forfeit your benefits.
  4. In fact, if you move out of state for a five-year period, you forfeit your benefits, even if you move back.
  5. If you die before using it, there is no benefit to your beneficiaries or estate.
  6. You can opt-out by getting your own policy, but the opt-out period is limited to October 1, 2021 to December 31, 2022.
  7. In order to opt-out, you must attest that you’ve purchased an individual LTC by November 1, 2021. This is a change from July as the state has given extra time to purchase insurance and to opt-out, since the pandemic caused them to miss educating employers and employees in 2020. 

The Act doesn’t offer the best possible options for funding needs as we age.

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