Overview
Washington is one of nine states that does not levy a state income tax on earned wages. Washington is one of nine states that does not levy a state income tax on earned wages. However, Washington has a Paid Family and Medical Leave (PFML) program that requires contributions from both employers and employees. The state also has a long-term care insurance program (WA Cares) funded through employee payroll deductions.
State Income Tax (SIT)
Washington does not impose a state income tax on individual wages. This means employers do not need to withhold any state income tax from employee paychecks. Employees get to keep more of their gross pay, and payroll administrators have one fewer withholding calculation to manage.
Setup Note: Even though there is no state income tax, if you have employees who work in multiple states, you may still need to set up Washington in your payroll system to ensure multi-state withholding calculations work correctly.
Employer State Unemployment Tax (SUTA)
Even without a state income tax, Washington employers are still required to pay into the state’s unemployment insurance fund.
Your specific SUTA rate will be assigned by the state based on your company’s history with unemployment claims. New employers typically start at the default rate until they build enough experience for an individualized rate.
| Tax Type | Employer-paid (not deducted from employee wages) |
| Default New Employer Rate | 1.16% |
| Rate Assignment | Experience-rated; assigned annually by the state based on unemployment claims history |
Paid Family and Medical Leave (PFML)
Washington has a Paid Family and Medical Leave program that requires contributions from both employers and employees. This is a mandatory insurance program that provides paid time off for qualifying family and medical events. While not a traditional income tax, it is a payroll obligation that employers must manage.
Washington also has a long-term care insurance program (WA Cares Fund) funded through employee payroll deductions. Employers must withhold and remit these contributions on behalf of their employees.
Federal Taxes That Apply
While Washington keeps things simple at the state level, all standard federal payroll taxes still apply:
| Federal Income Tax (FIT) | Based on W-4 – Employee (withheld by employer) |
| Social Security (FICA) | 6.2% each – Employee and Employer |
| Medicare | 1.45% each – Employee and Employer |
| Additional Medicare | 0.9% – Employee only (wages over $200K) |
| FUTA | 6.0% (typically 0.6% after credit) – Employer only |
What This Means for Your Payroll
Running payroll in Washington is relatively straightforward. Without a state income tax, you’ll primarily focus on federal withholdings and the employer-paid SUTA contribution. The key things to stay on top of are making sure your SUTA rate is current each year and that federal withholdings are calculated correctly based on each employee’s W-4.
Disclaimer: This content is provided for general informational purposes only and does not constitute legal, tax, or accounting advice. Netchex does not provide tax or legal guidance and makes no representations regarding the accuracy or applicability of this information. Laws and regulations may change. The information on this page reflects payroll tax guidelines as of March 2026. For the most current requirements, please refer to:
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