Most states hand new employers a long withholding checklist. Washington hands you a short one — because there is no state income tax. Full stop. But WA still runs three mandatory payroll programs that blindside small business owners every quarter, and missing even one deadline means a penalty notice from the Employment Security Department.
Here's what Washington employers actually owe under washington state payroll taxes 2026 — who pays, what the rates are, and when every dollar is due.
- No state income tax — zero state income tax withheld from employee paychecks.
- WA Cares Fund: 0.58% of gross wages, withheld from employees (long-term care benefit).
- Paid Family & Medical Leave (PFML): ~0.74% total premium, split between employer and employee.
- L&I Workers' Comp: employer-paid, rate set by job risk class.
- Quarterly deadlines: Apr 30, Jul 31, Oct 31, Jan 31.
Washington State Payroll Taxes at a Glance (2026)
Washington is one of the simpler states for payroll. But simpler is not the same as zero. Three distinct programs. Three agencies. Three reporting schedules. Get them wrong and you pay for it.
| Tax / Program | Who Pays | 2026 Rate | Wage Base |
|---|---|---|---|
| WA State Income Tax | N/A | 0% — None | N/A |
| WA Cares Fund | Employee only | 0.58% | Up to SS wage base ($176,100) |
| PFML Premium | Employer + Employee split | ~0.74% total* | Up to SS wage base ($176,100) |
| L&I Workers' Comp | Primarily employer | Varies by risk class | Per hour worked |
| Federal Payroll Taxes | Employer + Employee | FICA 15.3% (split) | SS cap $176,100; Medicare no cap |
*PFML rate confirmed by ESD for 2026; verify your specific employer/employee split at esd.wa.gov — it adjusts annually. WA Cares Fund rate is set by state law at 0.58% through current legislation.
Washington's "no income tax" advantage is real — but don't mistake simpler for zero. WA Cares and PFML are non-negotiable deductions on every qualifying paycheck.
Washington Employer Payroll Deadlines 2026
PFML and WA Cares reports file through the ESD's online portal on the same quarterly schedule. Miss a deadline and you face a 5% late penalty on premiums owed. A calendar reminder costs nothing.
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Q1 (Jan–Mar): Due April 30 — Report and remit PFML premiums, WA Cares contributions, and L&I quarterly hours via the ESD portal.
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Q2 (Apr–Jun): Due July 31 — Same submission via ESD. Don't wait until the last day — the portal gets congested.
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Q3 (Jul–Sep): Due October 31 — Federal Form 941 is also due this month. Two deadlines, same week. Build in buffer.
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Q4 (Oct–Dec): Due January 31 — The year's busiest deadline. W-2s are also due to employees by Jan 31. See our full Q4 payroll deadlines 2026 guide to map out the entire month.
WA Cares and PFML are reported together via the ESD portal — one submission covers both. No separate filings. That saves real time once you've kept clean records all quarter.
Step-by-Step: Running Washington Payroll for a Small Team
Consider a Seattle landscaping owner who hired his first three employees in early 2026. His first move was searching for a WA state withholding form. There isn't one. Here's what he actually needed.
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Register with ESD and L&I before the first paycheck. ESD covers PFML and WA Cares. L&I (Department of Labor & Industries) handles workers' comp separately. Both registrations are online and take under 30 minutes. Skipping this is among the costliest payroll mistakes to avoid.
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Determine your L&I risk class. Workers' comp premiums are calculated per hour worked, but rates vary dramatically by job type. Office staff (risk class 4904) run well under $1/hour. Field crews run significantly higher. Log in to L&I's online account system to confirm your assigned class — and if you have mixed roles, each gets its own rate.
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Set up federal withholding — that's your only withholding form step. Collect a federal W-4 from each new hire. No Washington state equivalent exists. Withhold federal income tax, Social Security (6.2%), and Medicare (1.45%) as normal. Then separately withhold WA Cares (0.58%) and the employee share of PFML from each paycheck.
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Remit quarterly via ESD and L&I's online system. File federal Form 941 on the federal schedule. Keep payroll records for at least four years. New to this entirely? Our guide on how to run payroll for small business walks through the full cycle from setup to first check.
Employers with fewer than 50 employees are exempt from paying the employer portion of PFML premiums. Your employees still pay their share — you withhold and remit it. The exemption doesn't apply to WA Cares Fund, which is 100% employee-paid regardless of company size.
For a deeper look at the full employer setup sequence — from EIN to first paycheck — small business payroll 101 covers every step.
Ready to generate accurate Washington pay stubs that show every deduction?
Generate Your Washington Pay Stubs Free →Washington is one of the most employee-benefit-rich states in the country — and with no income tax withholding, the setup is genuinely simpler than most. Master PFML, WA Cares, and L&I. Keep clean quarterly records. File on time. For a first-time employer, that's the entire job.
Washington Payroll Tax FAQs
Does Washington State have a state income tax I need to withhold from employee paychecks?
No. Washington has no state income tax — no state withholding form, no state income tax line on pay stubs. You still withhold federal income tax, Social Security, and Medicare, but those are federal obligations, not state ones.
What is the WA Cares Fund and do I have to deduct it from every employee's paycheck?
The WA Cares Fund is Washington's long-term care insurance program, funded by a 0.58% payroll deduction on wages up to the Social Security wage base ($176,100 for 2026). Most employees are subject to it. Some workers who purchased qualifying private long-term care insurance before November 1, 2021 may hold an ESD exemption — if so, you need that approval on file and must stop withholding for them. Always verify exemption status before excluding anyone from the deduction.
How do I find my L&I workers' compensation rate class in Washington?
L&I assigns your risk class based on the type of work your employees perform — not your industry broadly. Mixed workforces (say, an office manager plus field technicians) get separate classes and rates for each role. Log in to your L&I account at lni.wa.gov to see your assignments. Newly registered employers get their classes assigned during onboarding based on the job descriptions they submit.
When are Washington payroll taxes due, and what happens if I miss a deadline?
PFML and WA Cares premiums are reported and paid quarterly — due the last day of the month following the quarter (April 30, July 31, October 31, January 31). L&I premiums follow the same quarterly schedule. Missing deadlines triggers penalties and interest from ESD and L&I. If you're consistently late, both agencies can escalate to collections. Set calendar reminders at the start of each quarter — the filings themselves are straightforward once your records are current.
Running payroll in Washington means tracking federal withholding, PFML, WA Cares, and L&I — all on the same stub. Our pay stub generator handles every line automatically: correct deduction labels, accurate employer/employee splits, and a clean record your workers can actually read.
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