Real Estate Excise Tax Changes
In late Spring, Washington State’s legislators introduced a new, graduated Real Estate Excise Tax (REET), which replaces the fixed 1.28 percent tax applied evenly across all transactions. The new variable rate, which will take effect on January 1st, 2020, is similar to the structure in California and will be determined by a property’s value. To assist potential home sellers with navigating the changes, Realogics Sotheby’s International Realty launched WashingtonREET.com, a calculator that weighs the REET difference when selling in 2019 and 2020.
New REET rates will impact all property types and price points, with one exception: raw, undeveloped, agricultural land (this will remain at the current 1.28 percent rate). For those with homes valued at $500,000 and below, it will be favorable to wait on a sale, as the tax rate will drop slightly, to 1.1 percent. The $1.56 million mark is where a break-even point hits, and sellers priced above that point will of course be subject to larger REET sums, and thus may want to consider a 2019 home sale.
Visit WashingtonREET.com to explore the implication for your home sale and contact me if you’d like to schedule an appointment to discuss your real estate goals for 2019, 2020 and beyond.
This information is deemed reliable but cannot be guaranteed. Consult a qualified professional before making any investment decision. All excise tax calculations are rounded to the nearest dollar. Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned And Operated. Seller reserves the right to change product offering without notice. E&OE.