Signed by Governor Jay Inslee

Vote Smart's Synopsis:

Vote to pass a bill that establishes a graduated Real Estate Excise Tax (REET).

Highlights:

• Defines “agricultural land” as farm and agricultural conservation land (Sec. 1).

• Defines “timberland” as land classified or designated under previous law that includes any structures and standing timber on said land, and standing timber sold apart from the land (Sec. 1).

• Specifies an excise tax rate of 1.28 percent until December 31, 2019 and then establishes the following tax rates beginning January 1, 2020 (Sec. 1):

• 1.1 percent of the portion of the selling price that is less than or equal to $500,000;

• 1.28 percent of the portion of the selling price that is greater than $500,000 and equal to or less than $1.5 million;

• 2.75 percent of the portion of the selling price that is greater than $1.5 million and equal to or less than $3 million; and

• 3 percent of the portion of the selling price that is greater than $3 million.

• Authorizes the Department of Labor, beginning January 1, 2022 and every fourth year after, to adjust the selling price thresholds and publish the updated selling price thresholds by September 1, 2022 (Sec. 1).

• Requires the Department to publish guidance to assist sellers in classifying real property on the proper real estate excise tax affidavit in order to determine the correct tax amount due under this section (Sec. 1).

• Requires the sale of real property classified as timberland or agricultural land to be subject to the tax imposed under this section, at a rate of 1.28 percent of the selling price (Sec. 1).

• Establishes that county treasurers are not responsible for verifying that the seller has properly classified real property reported on a real estate excise tax affidavit (Sec. 1).

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that establishes a graduated Real Estate Excise Tax (REET).

Highlights:

• Defines “agricultural land” as farm and agricultural conservation land (Sec. 1).

• Defines “timberland” as land classified or designated under previous law that includes any structures and standing timber on said land, and standing timber sold apart from the land (Sec. 1).

• Specifies an excise tax rate of 1.28 percent until December 31, 2019 and then establishes the following tax rates beginning January 1, 2020 (Sec. 1):

• 1.1 percent of the portion of the selling price that is less than or equal to $500,000;

• 1.28 percent of the portion of the selling price that is greater than $500,000 and equal to or less than $1.5 million;

• 2.75 percent of the portion of the selling price that is greater than $1.5 million and equal to or less than $3 million; and

• 3 percent of the portion of the selling price that is greater than $3 million.

• Authorizes the Department of Labor, beginning January 1, 2022 and every fourth year after, to adjust the selling price thresholds and publish the updated selling price thresholds by September 1, 2022 (Sec. 1).

• Requires the Department to publish guidance to assist sellers in classifying real property on the proper real estate excise tax affidavit in order to determine the correct tax amount due under this section (Sec. 1).

• Requires the sale of real property classified as timberland or agricultural land to be subject to the tax imposed under this section, at a rate of 1.28 percent of the selling price (Sec. 1).

• Establishes that county treasurers are not responsible for verifying that the seller has properly classified real property reported on a real estate excise tax affidavit (Sec. 1).

Full Bill Text