As we welcome 2025, it’s the perfect time to reflect on the past year and set our sights on the year ahead. While it may not be the most exciting part of the new year, don’t forget to stay on top of important details like payroll updates and tax deadlines. Whether you’re an experienced business owner or just getting started, staying informed is essential to keeping everything running smoothly.
In this blog post, we've summarized some key updates to make it easier for you to stay on top of things. Let's dive in!
2025 Rate Adjustments
Washington State Minimum Wage Increase
Starting January 1, 2025, the state minimum wage will rise from $16.28 to $16.66 per hour. If you have employees earning minimum wage, be sure to update their payroll to reflect this change. Learn more on the L&I website.
City of Bellingham Minimum Wage Increase
The city minimum wage, which is $1.00 higher than the state rate, will increase to $17.66 per hour starting January 1, 2025.
Looking ahead, on May 1, 2025, the City of Bellingham will increase its minimum wage to $2.00 above the state rate, bringing it to $18.66 per hour. Make sure to plan ahead and adjust wages accordingly when the change takes effect. Learn more about the City of Bellingham Minimum Wage.
Paid Leave Premium Increase
Washington’s Paid Family and Medical Leave program has increased the premium rate to 0.92%, up from 0.74% in 2024. Employers with more than 50 employees will contribute 28.48% of the premium, while employees cover the remaining 71.52%.
Businesses classified by the Employment Security Department as having fewer than 50 employees for the 2025 calendar year are not required to pay the employer portion of the premium. Learn more on the Paid Leave website.
Workers’ Compensation Rate Increase
The average cost of workers’ compensation insurance will increase by 3.8% in 2025. For employers and workers, this means an additional average cost of $52.50 per year per full-time employee. Learn more on the L&I website.
IRS Standard Mileage Rate
The IRS has bumped the standard mileage reimbursement rate to 70 cents per mile, up from 67 cents in 2024. Learn more on the IRS website.
Important Deadlines
In addition to these rate increases, January comes with several important deadlines for businesses. Make sure to mark these dates on your calendar:
January 15, 2025
Quarterly Estimated Tax Payments for Q4 — Submit to the IRS
January 25, 2025
Monthly DOR Filers: Excise Tax Return — Submit to the DOR
January 31, 2025
Don't let this deadline slip through the cracks! January 31 is a big day for federal and state filings. Here’s a quick breakdown:
Federal IRS Deadlines
Form 941: Quarterly Federal Tax Return for Q4 (or Form 944 for eligible small employers)
Form 940: Annual Federal Unemployment Tax Return
Form W-2: Wage and Tax Statements — Provide copies to employees and submit to the IRS
Form 1099-NEC and/or Form 1099-MISC — Provide copies to contractors and submit to the IRS
Washington State Deadlines
Department of Revenue (Quarterly Filers): Excise Tax Return for Q4
Employment Security Department: State Unemployment Insurance (SUI) Report and Payment for Q4
Labor & Industries (L&I): Report and Payment for Q4
Paid Family and Medical Leave: Report and Payment for Q4
WA Cares Fund: Report and Payment for Q4
City of Bellingham Deadlines
Quarterly Filers: B&O Tax Return for Q4
Monthly Filers: B&O Tax Return for December
Every business is unique, so you may have additional updates and requirements based on your industry or circumstances. If you’re unsure about what applies to you, don’t hesitate to reach out to a trusted professional like your accountant, bookkeeper, payroll processor, or HR representative.
Starting the year on the right foot makes all the difference. Here’s to a productive and prosperous new year!