Practical legal guidance on QSBS (Section 1202), equity compensation, startup formation, financing, and Washington State tax issues for founders, investors, and startup employees.
Since October 2025, Washington taxes the services most startups sell — IT, custom software, advertising, training. The DOR is waiving penalties for companies that come forward by September 30, 2027. Here's the diagnosis and the fix.
A §1045 rollover relocates your tax problem onto the replacement company's balance sheet. One $2M rollover, five trajectories — and the maintenance system that decides which one you get.
IP26-645 kills the 9.9% income tax before it starts — but the capital gains excise tax under chapter 82.87 RCW survives. Here's what the initiative's actual text does, and the litigation it sets up.
In a stock-for-stock acquisition, your QSBS may survive under Section 1202(h)(4) — but with an exchange-date gain cap most shareholders don't know about.
Changing domicile out of Washington is proven with paper, not intentions. A phase-by-phase checklist — before the move, move week, first 90 days, and every year after — with the documentation to keep at each step.
In PLR 201636003 the IRS ruled that stock can be QSBS without formal stock certificates — ownership is a matter of economic substance. Here's what the ruling holds, and what it carefully didn't decide.
QSBS is a fact-intensive benefit. The IRS doesn't take your word for it. Here's what your documentation needs to cover.
IP26-645 submitted 511,408 signatures on July 2 — nearly double the requirement. What the repeal initiative does, the November 3 timeline, the two-year constitutional lock if it passes, and why founders should keep planning as if the 9.9% tax takes effect.
Washington's 30-day safe harbor makes you a nonresident — it doesn't change your domicile. Long-term stock gains are allocated by domicile at the time of sale, so the safe harbor alone won't protect your exit.
