[WSBAPT] Washington estate tax question

[Sara D. Longley]

Here's what the Department of Revenue has to say on the matter:
http://dor.wa.gov/content/FindTaxesAndRates/OtherTaxes/tax_estatetaxfaq.aspx
#oosproperty

 

Intangible assets, such as interests in an LLC, are considered to be located
in the owners' state of domicile.

 

I believe an LLC established to hold and operate one or more rental
properties is established for a "true business purpose" since operating a
rental is a business activity.  The DOR form for "Apportionment of Out of
State Property" uses the example of an LLC-owned family vacation home as a
non-business activity.

 

Best,

Sara

 



Sara D. Longley, J.D., LL.M.

Attorney at Law

 

1734 NW Market Street

Seattle, WA 98107

 <tel:%28206%29%20434-5644> (206) 434-5644

 <mailto:Sara at longley-law.pro> Sara at longley-law.pro

 <http://www.longley-law.pro/> www.longley-law.pro

 

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From: wsbapt-bounces at lists.wsbarppt.com
[mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Karin Treadwell
Sent: Friday, June 16, 2017 3:01 PM
To: wsbapt at lists.wsbarppt.com
Subject: [WSBAPT] Washington estate tax question

 

Out of state couple own a commercial property in Washington via a Washington
LLC.  They also own two Washington residential properties as rentals, and
for liability purposes would like to transfer these to Washington LLCs.

 

Assuming they have established domicile out of state, wouldn't the value of
the business interests (whether held by the couple personally or their RLT)
be considered an intangible asset and thus out of state property for
Washington estate tax purposes?  

 

The DOR website emphasizes that whether an ownership interest is determined
to be an intangible or tangible asset is based on whether it is operating
for a "true business purpose."  

 

Any feedback on how DOR is defining a true business purpose?  Operating a
commercial building?  What about putting rental homes into an LLC for
liability protection?

 

Karin

Karin S. Treadwell

Sayre Law Offices, PLLC

1417 31st Ave S

Seattle WA  98144-3909

 

phone 206-625-0092

fax 206-625-9040

 

Please Note that We Have Moved

 

We have moved our Seattle office to Mount Baker Ridge (a small commercial
community just above the I-90 tunnel).

 

Our new address is 1417 31st Avenue South, Seattle WA 98144

 

All other contact information will remain the same

 

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