In March of 2022, the Douglas County Superior Court ruled in Quinn v. State of Washington that the capital gains excise tax (ESSB 5096) does not meet state constitutional requirements and, therefore, is unconstitutional and invalid. The State has appealed the ruling to the Washington Supreme Court. While the appeal is pending, the agency was granted a stay of the Douglas County ruling. The stay does not resolve the issues surrounding the constitutionality of the capital gains tax, but it does preserve the agency’s ability to effectively administer and implement the tax and meet statutory obligations, including accepting tax payments, pending a final decision from the Washington Supreme Court. As a result, the online system is now available to report and pay the tax. If the Court eventually finds the statute to be unconstitutional, any tax payments received will be promptly refunded with interest.
The Department will continue to provide guidance to the public regarding the tax as a courtesy. Any guidance provided herein will apply only if the tax is ruled constitutional and valid, in its entirety, by a court of final jurisdiction.
Subscribe to receive email or SMS/text notifications about the Capital Gains tax.
For each tax year (calendar year), these questions can be used to help you determine if you may owe Washington state capital gains tax. This questionnaire is for informational purposes only and is not binding upon the department.
If you answer Yes to the above question, please continue to the Assets and Domicile section.
If you answered Yes to any of the above questions, continue to the Amount section.
If you answered Yes to the above question, you may owe Washington state capital gains tax.