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<p class="MsoNormal">Looks like this nonpro rata WAC exemption example:<o:p></o:p></p>
<p class="MsoNormal" style="mso-margin-top-alt:3.75pt;margin-right:0in;margin-bottom:7.5pt;margin-left:0in;background:white">
<b><span style="font-size:13.5pt;font-family:"Helvetica",sans-serif;color:black">WAC 458-61A-202<o:p></o:p></span></b></p>
<p class="MsoNormal" style="mso-margin-top-alt:3.75pt;margin-right:0in;margin-bottom:7.5pt;margin-left:0in;background:white">
<b><span style="font-size:13.5pt;font-family:"Helvetica",sans-serif;color:black">Inheritance or devise.<o:p></o:p></span></b></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(1) <b>Introduction.</b> Transfers of real property through a devise by will or inheritance are not subject to the real
estate excise tax. For the purpose of this exemption, it does not matter whether the real property transferred was encumbered by underlying debt at the time it was inherited or devised.<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(2) <b>Definitions.</b> For the purposes of this rule, the following definitions apply:<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(a) "Heir" means a person, including the surviving spouse or surviving domestic partner, who is entitled under the statutes
of intestate succession to the real and personal property of a decedent on the decedent's death intestate;<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(b) "Lack of probate affidavit" means a signed and notarized document declaring that the affiant or affiants are the
rightful heir or heirs to the property and containing the following information:<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(i) The names of the affiant or affiants;<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(ii) The relationship of the affiant or affiants to the decedent;<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(iii) The names of all other heirs of the decedent living at the time of the decedent's death;<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(iv) A description of the real property;<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(v) Whether the decedent left a will that includes a devise of real property; and<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(vi) Any other information the department may require.<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(c) "Nonpro rata distribution" is a distribution in which the transfer of real property to the heirs or devisees may
not be in proportion to their interests.<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black">(3) <b>Examples.</b> This rule contains examples that identify a number of facts and then state a conclusion. These
examples should be used only as a general guide. The tax results of other situations must be determined after a review of all of the facts and circumstances.<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black;background:yellow;mso-highlight:yellow">(4) <b>Nonpro rata distributions.</b> A nonpro rata distribution made by a personal
representative of a probated estate or by the trustee of a trust is not subject to the real estate excise tax if:<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black;background:yellow;mso-highlight:yellow">(a) The transfer is authorized under the nonintervention powers of a personal
representative under RCW </span><span style="color:black"><a href="http://app.leg.wa.gov/RCW/default.aspx?cite=11.68.090"><b><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:#7DAB8A;background:yellow;mso-highlight:yellow">11.68.090</span></b></a></span><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black;background:yellow;mso-highlight:yellow"> or
under the nonpro rata distribution powers of a trustee under RCW </span><span style="color:black"><a href="http://app.leg.wa.gov/RCW/default.aspx?cite=11.98.070"><b><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:#7DAB8A;background:yellow;mso-highlight:yellow">11.98.070</span></b></a></span><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black;background:yellow;mso-highlight:yellow">(15);
and<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black;background:yellow;mso-highlight:yellow">(b) If no consideration is given to the personal representative or the trustee
for the transfer.<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black;background:yellow;mso-highlight:yellow">For the purpose of this rule, consideration does not include the indebtedness
balance of any real property that is encumbered by a security lien.<o:p></o:p></span></p>
<p class="MsoNormal" style="text-indent:.5in;background:white"><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black;background:yellow;mso-highlight:yellow">(c) <b>Example 1.</b> Aunt Mary wills her entire estate equally to her three
nieces, Meg, Beth, and Jo. The estate consists of her primary residence, a cottage at the ocean, and significant cash assets, among other things. Rather than take title to the two parcels of real estate in all three names, the estate may be distributed by
deeding the primary residence to Meg, the oceanfront property to Beth, and the majority of the cash assets to Jo.</span><span style="font-size:12.0pt;font-family:"Helvetica",sans-serif;color:black"><o:p></o:p></span></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-family:"Script MT Bold"">Jennifer L. White, Esq.</span>
<span style="font-family:"Script MT Bold""><o:p></o:p></span></p>
<p class="MsoNormal"><img border="0" width="105" height="105" style="width:1.0958in;height:1.0958in" id="Picture_x0020_2" src="cid:image003.jpg@01D6E41E.02DC9290"><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><a href="mailto:jen@appletreelaw.com"><span style="font-family:"Arial Rounded MT Bold",sans-serif;color:#0563C1">jen@appletreelaw.com</span></a><i><span style="font-family:"Arial Rounded MT Bold",sans-serif"><o:p></o:p></span></i></p>
<p class="MsoNormal"><span style="font-family:"Arial Rounded MT Bold",sans-serif">PO Box 11037<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Arial Rounded MT Bold",sans-serif">Yakima, WA 98909<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Arial Rounded MT Bold",sans-serif">509.225.9813<o:p></o:p></span></p>
<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal"><b>From:</b> wsbarp-bounces@lists.wsbarppt.com <wsbarp-bounces@lists.wsbarppt.com>
<b>On Behalf Of </b>Kira Rubel<br>
<b>Sent:</b> Wednesday, January 6, 2021 11:00 AM<br>
<b>To:</b> WSBA Real Property Listserv <wsbarp@lists.wsbarppt.com><br>
<b>Subject:</b> [WSBARP] Excise tax on inherited properties out of FLP and RLT<o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal">Hello again, list! I have three clients who inherited 9 properties from their now-deceased parents, out of the parents' Family Limited Partnership and the parents' living trust. Now, we're in the process of transferring title to each
child's LLC or living trust. <o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal">The parents did not leave specific properties to specific kids, rather all properties were left to all three children. The three adult children decided among themselves how to divide up the properties (and cash). Each child is taking 3
properties in their entirety. <o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal">My office spoke with the DOR-Excise Tax department and they said we might have an excise tax problem since each property was left to all three children, rather than one property per one child. Has anyone run into this before? There has
to be a work-around, since this is inherited property! <o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal">Any and all guidance is appreciated! <o:p></o:p></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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<p class="MsoNormal">Thank you! <br clear="all">
<o:p></o:p></p>
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<p><i><span style="font-size:13.5pt;font-family:"Cambria",serif">Kira M. Rubel, Esq.</span></i><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p></o:p></span></p>
<p style="background-image:initial;background-position:initial;background-repeat:initial">
<i><span style="font-size:10.0pt;font-family:"Cambria",serif">*Licensed in CA and WA</span></i><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="color:#222222"><img border="0" width="96" height="48" style="width:1.0in;height:.5in" id="_x0000_i1025" src="https://drive.google.com/a/theharborlawgroup.com/uc?id=1E57YB_h2v4LJLf-5LkuttKj5KjL212Bk&export=download"></span><span style="color:#222222"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="color:#222222"><o:p> </o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto"><b><span style="font-family:"Georgia",serif;color:#222222">The Harbor Law Group </span></b><span style="color:#222222"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto"><span style="font-family:"Georgia",serif;color:#222222">(<i>formerly, Law Office of Kira M. Rubel</i>)</span><span style="color:#222222"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto"><b><span style="font-family:"Georgia",serif;color:#222222">3615 Harborview Drive NW, Suite C (on the dock)</span></b><span style="color:#222222"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto"><b><span style="font-family:"Georgia",serif;color:#222222">Gig Harbor, WA 98332-2129</span></b><span style="font-family:"Georgia",serif;color:#222222"> </span><span style="color:#222222"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto"><span style="font-family:"Georgia",serif;color:#222222">CA Bar No. 253970 / WA Bar No. 51691</span><span style="color:#222222"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto"><span style="font-family:"Georgia",serif;color:#222222">Tel. (253) 358-2215 | (800) 836-6531</span><span style="color:#222222"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto"><span style="font-family:"Georgia",serif;color:#222222">Fax. (253) 358-2191</span><span style="color:#222222"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto"><a href="https://theharborlawgroup.com/" target="_blank"><span style="font-family:"Georgia",serif">https://theharborlawgroup.com/</span></a><o:p></o:p></p>
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