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<p class="MsoNormal">John,<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">I agree. It is not often we get a simplification.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">I think this may be the answer to Phil’s question earlier about why they are making this change. Getting rid of “true business purpose” is just easier for taxpayers and the department.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal" style="background:white"><span style="font-family:"Helvetica",sans-serif;color:#833C0B">Sincerely,</span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-family:"Helvetica",sans-serif;color:#833C0B"> </span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:14.0pt;font-family:"Helvetica",sans-serif;color:#833C0B">Derek W. Jensen,
</span><span style="font-family:"Helvetica",sans-serif;color:#833C0B">JD, LLM</span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-family:"Helvetica",sans-serif;color:#833C0B">Managing Attorney</span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:10.0pt;font-family:"Helvetica",sans-serif;color:#833C0B">Jensen Law Office, PLLC</span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="color:#833C0B"><o:p> </o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal"><b>From:</b> wsbapt-bounces@lists.wsbarppt.com <wsbapt-bounces@lists.wsbarppt.com>
<b>On Behalf Of </b>John J. Sullivan, Esq.<br>
<b>Sent:</b> Friday, May 29, 2020 10:19 AM<br>
<b>To:</b> 'WSBA Probate & Trust Listserv' <wsbapt@lists.wsbarppt.com><br>
<b>Subject:</b> Re: [WSBAPT] Special Notice - Estate tax treatment of real property owned by business entities<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Oh! I sent this before reading the update. Reason prevails for once at the DOR! I’m pleasantly surprised!<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal"><b>From:</b> John J. Sullivan, Esq. <<a href="mailto:sullaw@comcast.net">sullaw@comcast.net</a>>
<br>
<b>Sent:</b> Friday, May 29, 2020 10:16 AM<br>
<b>To:</b> 'WSBA Probate & Trust Listserv' <<a href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</a>><br>
<b>Subject:</b> RE: [WSBAPT] Special Notice - Estate tax treatment of real property owned by business entities<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Agreed. <o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">I had one client who resided here. They owned a house in Sun Valley, ID. And a condo in Manhattan. Placing the ID realty in a revocable trust it is still sourced to ID which has no estate tax. Placing the NY condo in an LLC renders it personalty
that is sourced here to WA, where the rates are not as high as the stand alone estate tax in NY.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Be careful. I believe the DOR still takes the position that WA realty held by a nonresident in a single member LLC remains realty sourced here. I disagree, but there you have it. One option to consider to counter their argument is to operate
it as an AirBnb when not spending time in it here in WA. If the LLC is an operating business it is respected.
<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">John J. Sullivan<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal"><b>From:</b> <a href="mailto:wsbapt-bounces@lists.wsbarppt.com">
wsbapt-bounces@lists.wsbarppt.com</a> <<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>Diane J. Kiepe<br>
<b>Sent:</b> Friday, May 29, 2020 9:40 AM<br>
<b>To:</b> WSBA Probate & Trust Listserv <<a href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</a>><br>
<b>Subject:</b> Re: [WSBAPT] Special Notice - Estate tax treatment of real property owned by business entities<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt">The first two have assets includable for WA estate tax purposes because they hold intangibles here as residents.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt">The second two –<u> now</u> are not deemed to hold an intangible property because the LLC interest is what they own and that follows them to t heir state of residency. Previously there was further analysis
required (business vs nonbusiness purpose of property).<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt">Remember too, for planning purposes, this addresses LLCs only, not trusts.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt">That is my reading – and my take away is people leaving WA to reside elsewhere but leave property here are well served by placing the same in an LLC.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt"><o:p> </o:p></span></p>
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<p class="MsoNormal"><i><span style="font-family:"Script MT Bold"">Diane J. Kiepe<o:p></o:p></span></i></p>
<p class="MsoNormal"><i><span style="font-family:"Script MT Bold""><o:p> </o:p></span></i></p>
<p class="MsoNormal">Diane J. Kiepe<o:p></o:p></p>
<p class="MsoNormal">Douglas Eden<o:p></o:p></p>
<p class="MsoNormal">717 W. Sprague Ave.<o:p></o:p></p>
<p class="MsoNormal">Suite 1500<o:p></o:p></p>
<p class="MsoNormal">Spokane, WA 99201<o:p></o:p></p>
<p class="MsoNormal"><a href="mailto:djkiepe@depdslaw.com"><span style="color:#0563C1">djkiepe@depdslaw.com</span></a><o:p></o:p></p>
<p class="MsoNormal">509-455-5300<o:p></o:p></p>
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<p class="MsoNormal"><span style="font-size:14.0pt"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b>From:</b> <a href="mailto:wsbapt-bounces@lists.wsbarppt.com">
wsbapt-bounces@lists.wsbarppt.com</a> <<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>Karl Flaccus<br>
<b>Sent:</b> Friday, May 29, 2020 9:32 AM<br>
<b>To:</b> WSBA Probate & Trust Listserv <<a href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</a>><br>
<b>Subject:</b> Re: [WSBAPT] Special Notice - Estate tax treatment of real property owned by business entities<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E">Maybe someone could provide an explanation of what this means in these circumstances:<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E">A Washington resident owns a nonbusiness out-of-state vacation home in an LLC.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E">A Washington resident owns an out-of-state rental home in an LLC.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E">An out-of-state resident owns a Washington vacation home in an LLC.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E">An out-of-state resident owns a Washington rental home in an LLC.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E">Thanks in advance.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E">Karl<o:p></o:p></span></p>
<p class="MsoNormal"><i><span style="font-family:"Times New Roman",serif;color:#0F243E"><o:p> </o:p></span></i></p>
<p class="MsoNormal"><i><span style="font-family:"Times New Roman",serif;color:#0F243E">F</span></i><i><span style="font-size:9.0pt;font-family:"Times New Roman",serif;color:#0F243E">LACCUS</span></i><i><span style="font-family:"Times New Roman",serif;color:#0F243E">
L</span></i><i><span style="font-size:10.0pt;font-family:"Times New Roman",serif;color:#0F243E">A</span></i><i><span style="font-size:9.0pt;font-family:"Times New Roman",serif;color:#0F243E">W</span></i><i><span style="font-family:"Times New Roman",serif;color:#0F243E"><o:p></o:p></span></i></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#0F243E">7010 35th Ave. N.E.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#0F243E">Seattle, Washington 98115<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Times New Roman",serif;color:#0F243E">206 523-0297</span><span style="color:#0F243E"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#0F243E"><o:p> </o:p></span></p>
<p class="MsoNormal"><i><span style="font-family:"Times New Roman",serif;color:#0F243E">I</span></i><i><span style="font-size:9.0pt;font-family:"Times New Roman",serif;color:#0F243E">nformation in this e-mail message is privileged, confidential, and intended
only for the use of the recipient named. If you received this in error, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited – please notify us by telephone immediately at (206) 523-0297, and
delete the original message. Thank you.<o:p></o:p></span></i></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif;color:#0F243E"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b>From:</b> <a href="mailto:wsbapt-bounces@lists.wsbarppt.com">
wsbapt-bounces@lists.wsbarppt.com</a> <<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>Philip N. Jones<br>
<b>Sent:</b> Thursday, May 28, 2020 4:27 PM<br>
<b>To:</b> WSBA Probate & Trust Listserv <<a href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</a>><br>
<b>Subject:</b> Re: [WSBAPT] Special Notice - Estate tax treatment of real property owned by business entities<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="color:#1F497D">A very interesting new development. Washington and Oregon are apparently now on the same page on this issue.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">Phil Jones<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">Portland, OR<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
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<div style="border:none;border-top:solid #E1E1E1 1.0pt;padding:3.0pt 0in 0in 0in">
<p class="MsoNormal"><b>From:</b> <a href="mailto:wsbapt-bounces@lists.wsbarppt.com">
wsbapt-bounces@lists.wsbarppt.com</a> <<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>Derek Jensen<br>
<b>Sent:</b> Thursday, May 28, 2020 4:22 PM<br>
<b>To:</b> <a href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</a><br>
<b>Subject:</b> [WSBAPT] FW: Special Notice - Estate tax treatment of real property owned by business entities<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Just received in my in-box: New treatment for real property owned by business entities.
<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal" style="background:white"><span style="font-family:"Helvetica",sans-serif;color:#833C0B">Sincerely,</span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-family:"Helvetica",sans-serif;color:#833C0B"> </span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:14.0pt;font-family:"Helvetica",sans-serif;color:#833C0B">Derek W. Jensen,
</span><span style="font-family:"Helvetica",sans-serif;color:#833C0B">JD, LLM</span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-family:"Helvetica",sans-serif;color:#833C0B">Managing Attorney</span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:10.0pt;font-family:"Helvetica",sans-serif;color:#833C0B">Jensen Law Office, PLLC</span><span style="color:#833C0B"><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="color:#833C0B"><o:p> </o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal"><b>From:</b> Corinna O'Connor <<a href="mailto:corinnao@DOR.WA.GOV">corinnao@DOR.WA.GOV</a>>
<br>
<b>Sent:</b> Thursday, May 28, 2020 4:10 PM<br>
<b>To:</b> <a href="mailto:ESTATE-TAX-NOTIFICATIONS@LISTSERV.DOR.WA.GOV">ESTATE-TAX-NOTIFICATIONS@LISTSERV.DOR.WA.GOV</a><br>
<b>Subject:</b> Special Notice - Estate tax treatment of real property owned by business entities<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p><span style="font-family:"Arial",sans-serif">The Department of Revenue has issued a special notice in regards to the estate tax treatment of real property owned by business entities.</span><o:p></o:p></p>
<p><span style="font-family:"Arial",sans-serif">This special notice is effective June 1, 2020 and can be found by clicking the following link.</span><o:p></o:p></p>
<p><a href="https://dor.wa.gov/sites/default/files/legacy/Docs/Pubs/SpecialNotices/2020/sn_20_EstateTaxTreatment.pdf"><span style="font-family:"Arial",sans-serif">https://dor.wa.gov/sites/default/files/legacy/Docs/Pubs/SpecialNotices/2020/sn_20_EstateTaxTreatment.pdf</span></a><o:p></o:p></p>
<p><span style="font-family:"Arial",sans-serif">The special notice is located under the Forms & Publication section of the Estate Tax section on the department's homepage, as well.</span><o:p></o:p></p>
<p><span style="font-family:"Arial",sans-serif"><a href="https://dor.wa.gov/taxes-rates/other-taxes/estate-tax"><span style="font-size:13.5pt">https://dor.wa.gov/taxes-rates/other-taxes/estate-tax</span></a></span><o:p></o:p></p>
<p><span style="font-family:"Arial",sans-serif">For questions, please call the estate tax team at 360-534-1503, option 2, or send an e-mail to
<a href="mailto:estates@dor.wa.gov">estates@dor.wa.gov</a>. </span><o:p></o:p></p>
<p class="MsoNormal">To join or leave this list, change your settings, or view the the list archives, go to https:listserv.wa.gov/cgi-bin/wa?A0=estate-tax-notifications
<o:p></o:p></p>
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