[WSBARP] May a PSA require buyer to pay REET?

[Rod Harmon]

Dwight, I think you are over-thinking the problem.  If the REPSA says the sale price is $100,000, that’s what I put in the REETA.  No one has ever questioned it.  Although I have never queried DOR’s excise tax people about it.

 

Rod Harmon

 

RODNEY T. HARMON

       Attorney at Law

         P.O. Box 1066

      Bothell, WA   98041

     Tel:   (425) 402-7800

     Fax:  (425) 458-9096

     <http://www.rodharmon.com> www.rodharmon.com

    <mailto:rodharmon at msn.com> rodharmon at msn.com

 

 

From: wsbarp-bounces at lists.wsbarppt.com [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Bickel, Dwight
Sent: Thursday, September 1, 2016 12:56 PM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] May a PSA require buyer to pay REET?

 

The parties may agree for the buyer to pay the real estate sales tax. Your contract does that, because state excise law does not prohibit the payment of that tax by the buyer.

 

It is a math challenge though, because the sales tax applies to the amount of the sales tax. You must compute the revised sales price upon which the tax is computed.

 

Original Sales Price divided by

(1-[Applicable Excise Tax Rate])

 

For example: 100,000 price becomes $101,812.26 adjusted sales tax where the rate is .0178%.

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