Washington’s legislators have less than two weeks to reconcile the budget and avoid a special session. Here is a quick overview of some of the major tax proposals we’re monitoring this legislative session and a reminder for those with property in Washington State about upcoming deadlines.
Legislative Tax Updates
The Washington State Legislature is currently considering major proposals to raise revenue for both state and local governments. These include:
- Another B&O Tax Surcharge: A 1% B&O tax surcharge on taxpayers with Washington taxable income greater than $250 million and a change to the additional tax on certain financial institutions, raising it to 1.9% (currently 1.2%).
- Wealth Tax: Legislators have officially tabled proposals to tax intangible assets given Governor Bob Ferguson’s opposition to a wealth tax — a proposal that, if enacted, would certainly have drawn legal challenges.
- Payroll Tax: A Seattle-style payroll tax of 5% on payroll expenses above the Social Security threshold for companies with $7 million or more in payroll expenses.
- Property Tax Levy Growth: Tax districts must currently limit the growth in their budgets to 101% of the prior year’s budget (before considering property taxes from new construction and omitted property). The House and Senate have both proposed bills lifting this cap to allow growth based on population change and inflation.
Upcoming Property Tax Deadlines
Payment Under Protest: If you missed the administrative appeal deadline but still want to challenge your 2024 assessed value, you can pay your taxes under protest by sending your tax payment with a letter setting forth the grounds for challenging the assessed value. Only if you pay under protest will you then have the right to commence a refund lawsuit in court on your 2024 value by June 30, 2026.
Petition to Reconvene: You may also be able to reopen your right to an administrative appeal rather than going to court:
- If you bought your property between July 1 and December 31, 2024, in an arm’s-length market sale for less than 90% of the assessed value, you have a deadline of April 30, 2025, to petition the county board of equalization to reconvene to review the 2024 assessment of property.
- If you can provide preliminary proof that your assessed value was at least double the market value, you may be able to reopen your administrative appeal rights with a longer deadline for doing so.
Keep an eye out for your invitation to our annual Washington State Tax Update — and in the meantime, feel free to contact us if we can be of assistance.
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