Does Washington Saves apply to your business?

It's the common name for the 2024 state law, codified as chapter 19.05 RCW, that created Washington Saves. The law sets which employers must participate, what employers must do, and the penalties for willful violations. A governing board writes the detailed rules, which were proposed in August 2026 and weren't final as of October 23, 2026.

Employees fund their own accounts through payroll deductions, and employers can't contribute. The law directs the program to charge administrative fees to cover its costs and caps the fee for employees, investment costs are paid by participants, and the program states there are no employer fees.

A state retirement savings program created by RCW 19.05. Employees of covered employers are automatically enrolled in an individual retirement account (IRA) funded through payroll deduction, and they can change their contribution or opt out at any time.

The program launches July 1, 2027. Under rules proposed in August 2026, covered employers with more than 20,800 combined employee hours must register by December 1, 2028, and other covered employers by December 1, 2029.

Employers that have been in business in Washington for at least two years, have a physical presence here, had employees who worked at least 10,400 combined hours in the prior calendar year, and don't offer a qualified retirement plan. Government employers are excluded.

Yes, if they're 18 or older. Neither the law nor the proposed rules exclude part-time or seasonal employees, and their hours count toward the 10,400-hour test.

Union employees 18 and older are covered like other employees. The law and proposed rules don't address union or multiemployer plans directly. A union plan that qualifies under federal law may count as a qualified plan, but the rules don't say so, so it's worth confirming with the program.

Yes, if they're 18 or older. There's no special rule for prevailing-wage work, and the rules don't address how prevailing-wage fringe benefits interact with the program.

Generally no. The hours that count are those the business reports to the Employment Security Department for employees it pays Washington unemployment tax on.

Only hours for employees working for the business in Washington, meaning employees the business pays Washington unemployment tax on, as reported under its tax ID.

Under the proposed rules, the client business is the covered employer for its employees, and a qualified plan offered through the professional employer organization can meet the requirement.

Yes. The law applies to employers whether for profit or not for profit. Federal, state, and local government employers are excluded.

Yes. The law counts plans under sections 401(a), 401(k), 403(a), 403(b), 408(k), and 408(p) of the Internal Revenue Code as qualified plans, which includes a 401(k), SEP IRA, and SIMPLE IRA. A plan offered through a trade association or chamber of commerce also qualifies, and under the proposed rules, one offered through a professional employer organization.

No. The law makes the employer's role administrative and prohibits employer contributions. If you want to contribute for your team, you'd need a plan of your own, such as a SIMPLE IRA or 401(k).

Under the proposed rules, the default is 5% of wages into a Roth IRA, rising by 1% each January to a maximum of 10%. Employees can choose a different rate, a traditional IRA, or opt out.

Under the proposed rules, anyone 18 or older who isn't a covered employee can join, including owners. An IRA is limited to $7,500 in 2026, or $8,600 at age 50 and older, the business can't add to it, and Roth IRA contributions phase out at higher incomes. A 401(k) can allow $24,500 in deferrals and up to $72,000 with employer contributions, plus catch-up.

Employers with 100 or fewer employees may claim a startup credit of up to $5,000 a year for three years, a $500 credit for three years for automatic enrollment, and a credit of up to $1,000 per employee for employer contributions, phasing out over five years. Credits are reduced for employers with more than 50 employees.

Register with the program, provide employee information, deduct and remit contributions on time, and share program information. Employers aren't fiduciaries of the program and aren't liable for investment results.

The state first sends an educational letter and allows 90 days to fix the issue. Civil penalties can't be assessed before January 1, 2030, and then apply only to willful violations: up to $100 for the first, $250 for the second, and $500 for each one after.

With Washington Saves, the employer's role is administrative, the business can't contribute, and savings are limited to IRA amounts: $7,500 in 2026, or $8,600 at 50 and older. A SIMPLE IRA requires an employer contribution and allows $17,000 to $18,100 in deferrals, plus catch-up. A 401(k) allows $24,500 in deferrals and up to $72,000 with employer contributions, plus catch-up, with plan costs and fiduciary responsibilities. Federal credits can offset part of a new plan's cost. Which fits depends on the business and its goals.

Yes. As the sponsor of a 401(k), you're responsible for running the plan prudently, including the investment menu and fees. Some of those responsibilities can be shared with an advisor or other fiduciary.