[WSBARP] Real Estate Excise Tax Question

[Eric Nelsen]

Relief from debt is part of the consideration. If they're jointly liable, then him taking over the loan is consideration equal to half the mortgage balance. See WAC 458-61A-103<https://app.leg.wa.gov/WAC/default.aspx?cite=458-61A-103>, WAC 458-61A-102(3)(b)<https://app.leg.wa.gov/WAC/default.aspx?cite=458-61A-102>. So in your scenario, REET has to be paid on the cash transfer (half the equity) plus half the debt.
Re other stumbling blocks, there might be some, but this is how I've handled such situations before and I haven't found a better way to do it. Just need to factor in the cost of the transfer into settlement negotiations.
Sincerely,

Eric

Eric C. Nelsen
Sayre Law Offices, PLLC
1417 31st Ave South
Seattle WA 98144-3909
206-625-0092
eric at sayrelawoffices.com<mailto:eric at sayrelawoffices.com>

From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Mark Anderson
Sent: Thursday, September 7, 2023 2:47 PM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: [WSBARP] Real Estate Excise Tax Question

M and W, an unmarried couple, purchased a home in 2021.  They both signed a promissory note and deed of trust.  M and W are now breaking up and M wants to buy out W's interest in the property.  M and W have agreed that, in exchange for a quitclaim deed from W, M will fully assume the existing loan and pay half the equity in the property to W.
For the purposes of the real estate excise tax, how is the gross selling price calculated?
Do any of you know of any additional stumbling blocks in making this transaction work?
Thanks.
Mark B. Anderson
ANDERSON LAW FIRM PLLC
821 Dock St  Ste 209  PMB 4-12
Tacoma, Washington 98402
+1 253-327-1750
+1 253-327-1751 (fax)
marka at mbaesq.com<mailto:marka at mbaesq.com>
www.mbaesq.com<http://www.mbaesq.com/>
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