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Bill

Bill

HB 2009

Clarifying the calculation of the real estate excise tax for the transfer of a controlling interest in an entity holding real property.

2025-2026 Regular Session Introduced by Lisa Parshley and 2 co-sponsors

HB 2009 clarifies real estate excise tax calculation for controlling interest transfers in property-holding entities, potentially affecting how Washington taxes indirect real estate transactions.

First reading, referred to Finance.
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Bill Summary · HB 2009

Legislative bill overview

HB 2009 modifies how Washington State calculates real estate excise tax (REET) when ownership of real property transfers through the sale of a controlling interest in an entity (such as an LLC or corporation) rather than through a direct property sale. The bill aims to clarify calculation methods and potentially close perceived loopholes in how the tax applies to indirect property transfers.

Why is this important

Real estate excise tax generates significant state revenue for education and transportation. How the tax applies to entity sales—where someone buys controlling shares of a company that owns property rather than buying the property directly—affects both tax collection and business transaction costs. Clarification could either increase tax revenue or provide needed certainty for legitimate business deals, depending on the specific language.

Potential points of contention

  • Valuation disputes: Determining what constitutes a "controlling interest" sale and how to properly value the underlying property interest may create disagreements between taxpayers and tax authorities
  • Business impact: Real estate investors and business owners may face higher transaction costs or unexpected tax obligations if the clarification retroactively or prospectively expands REET application to deals previously considered exempt
  • Legislative intent clarity: Without seeing the specific amendments, it's unclear whether this closes loopholes (raising revenue) or merely clarifies existing law (creating certainty)—these have opposite political implications

Compiled from official sources — confirm details with the bill’s official record.

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