After opting out from the newly established long-term care payroll tax in Washington state by purchasing a qualifying long-term-care insurance, can one terminate the contract with the insurance? Or does one have to keep paying for the insurance every year?
asked Oct 17, 2021 at 21:41
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It certainly should be designed that you have to keep it, but whether they actually check I don't know.– Loren PechtelOct 17, 2021 at 23:28
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@LorenPechtel Thanks. In Should land, that tax would have never existed.– Franck DernoncourtOct 17, 2021 at 23:38
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The state is tired of paying for Medicaid for freeloaders who don't get insurance.– Loren PechtelOct 18, 2021 at 0:03
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@LorenPechtel true but with the opt-out close, only freeloaders and low income earners will not opt out. That's why LTC insurances have been inundated with applications.– Franck DernoncourtOct 18, 2021 at 0:12
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1 Answer
No, according to 3 insurance brokers I talked to. They told me that if an audit from the WA tax services sees that one has terminated the insurance, one would get some penalties (likely paying the 0.58% on the W2 income of the years without the long-term care insurance + some penalties). Obviously one can claim that the insurance brokers are biased, so if someone else can confirm and deny, preferably via a legal text, that'd be great.
answered Oct 18, 2021 at 19:33