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What is Washington's real estate excise tax? For the portion of the selling price that is:Real Estate Excise Tax RateLess than or equal to $525,0001.1%Greater than $525,000 and less than or equal to $1,525,0001.28%Greater than $1,525,000 and less than or equal to $3,025,0002.75%Greater than $3,025,0003.0%
The seller of the property typically pays the real estate excise tax, although the buyer is liable for the tax if it is not paid. Unpaid tax can become a lien on the transferred property. REET also applies to transfers of controlling interest (50% or more) in entities that own real property in the state.
Beginning January 1, 2022, Washington imposes a capital gains excise tax on the sale or exchange of long-term capital assets. The tax equals 7% multiplied by an individual's Washington capital gains.
Nonprofit organizations may be eligible for an exemption (pdf) from both the property tax and the leasehold excise tax. Typical organizations receiving the exemption are schools, churches, social service agencies, hospitals and child care organizations.
What is a controlling interest transfer? A controlling interest transfer occurs when there is a 50% or more change of ownership in an entity. If that entity owns real property in Washington, a controlling interest transfer return is required to be completed within 5 days of the completed transfer.
Transfers due to a court order or sale by a court in any mortgage, deed of trust, or lien foreclosure are exempt. This exemption does not apply to any other court ordered sale. Any type of negotiated sale is taxable unless another exemption applies.
When adding someone to a title, or changing names on a title, people will generally record a conveyance document/deed. You can get blank legal documents at a stationery or office supply store. It needs to be completed and notarized. The Recorder's Office cannot help with filling out your deed.
However, in some cases, the buyer may be required to pay a portion of the tax if it is not fully paid by the seller. The real estate excise tax rate in Washington State is between 1.1% and 3.0% of the sales price of the property. In 2021 the average home price in Washington State was $560,400.