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Taxes
Washington Payroll Taxes 2026: Complete Overview for Employers
No income tax, but SUI, PFML, WA Cares Fund, and workers' comp through L&I. All WA employer obligations explained.
Practical, accurate resources for Washington small business owners — covering payroll taxes, labor laws, and compliance.
No income tax, but SUI, PFML, WA Cares Fund, and workers' comp through L&I. All WA employer obligations explained.
Register at esd.wa.gov for UI and PFML. L&I workers' comp is separate at lni.wa.gov. Quarterly reporting for both agencies.
New employer rate ~1.0% varying by industry. Wage base $72,800 — very high compared to other states. Experience rating explained.
Combined rate 0.9%, employer and employee shares, 50+ employee threshold, up to 18 weeks combined leave. ESD administers claims.
0.58% employee-paid tax on all wages with no cap. Employer withholds and remits quarterly. Lifetime benefit ~$36,500.
WA statewide $16.28/hr indexed to CPI, Seattle $20.76/hr for large employers. No tipped credit — full minimum wage for all.
FICA, Social Security, Medicare, FUTA, federal withholding — the complete breakdown of what employers owe.
Get your EIN, register with the state, set up withholding, new hire reporting — the complete first-payroll checklist.
IRS 3-factor test, Washington's economic reality test, misclassification penalties, and when each classification makes sense.
IRS lookback period, deposit thresholds, next-day rule, EFTPS, and penalties for late deposits.
Federal and state new hire reporting requirements, what to report, how to file, and penalties for non-compliance.
FLSA, IRS, and Washington recordkeeping requirements — what to keep, how long, and why it matters.
ALE threshold, penalties for non-compliance, 1094-C/1095-C filing, small business exemption, and SHOP marketplace.
Misclassifying workers, wrong withholding, missed deposits, ignoring state law — the mistakes that add up fast.
Detailed comparison of Gusto, Paychex, QuickBooks Payroll, and ADP for Washington small businesses.
Federal OT after 40 hrs/week, Washington follows federal FLSA — plus exemptions, salary thresholds, and enforcement.