[WSBARP] Washington estate tax

[Katie Smith Patel]

Yes, it is the whole sum of the assets located anywhere that determines taxability, but Washington tax is only apportioned to the Washington property.  In a scenario where a person’s residence is outside Washington in a state with no estate tax, it would make sense to put Washington real property in an LLC so it would be considered intangible property.  I do not believe it matters where the LLC is formed because the decedent’s domicile determines whether intangible property is taxed in Washington.  Maybe you already read this page but I think it simplifies it:

https://dor.wa.gov/forms-publications/publications-subject/tax-topics/estate-tax-treatment-real-property-owned-business-entities

I recall the Washington Estate Planning Deskbook giving good examples with some scenarios.

Katie Patel
Paraclete Estate Planning, LLC
(541) 499-9085 (direct)
112 Genessee Street
Medford, OR 97504



From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Chris B
Sent: Monday, September 22, 2025 1:16 PM
To: wsbarp at lists.wsbarppt.com
Cc: wsbarp at lists.wsbarppt.com
Subject: Re: [WSBARP] Washington estate tax

Example 2(b) seems to indicate that a non-resident with only a $650K vacation home in Washington but large out of state assets is still subject to estate tax. This is what I find confusing:

https://app.leg.wa.gov/WAC/default.aspx?cite=458-57-125

Christopher T. Benis
Sent from my iPad


On Sep 22, 2025, at 12:58 PM, Bryce Dille <Bryce at dillelaw.com<mailto:Bryce at dillelaw.com>> wrote:
One of best ways to reduce any Washington inheritance tax is not be a Washington resident and not own any in state real property in individuals name there are other alternatives to employ as well
Sent from my iPhone


On Sep 22, 2025, at 11:33, Chris B <chrisb at firstavenuelaw.com<mailto:chrisb at firstavenuelaw.com>> wrote:

I am not an estate planner, but I am getting quite a few inquiries about how to plan for the Washington estate tax.  Specifically, I have quite a few clients moving their residence outside of Washington, but who still have investment properties and/or vacation homes in Washington.

Are there any especially good resources to learn the planning strategies.  For example, is there any benefit for using foreign LLCs to hold Washington properties? Similarly, what about using or avoiding Washington LLCs to hold assets outside the state.

I am also curious what my colleagues are experiencing. I am seeing a huge number of high net worth individuals and families leaving Washington.

FWIW, I’ve reviewed the DOR website and am only more confused.

Christopher T. Benis
Sent from my iPad

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