If Washington’s new millionaire tax takes effect on January 1, 2028, when would the first payment actually be due? When would estimated taxes begin? And what would taxpayers need to do to avoid underpayment penalties?
The short answer is this:
The tax would start on January 1, 2028.
The first return and first payment would generally be due in April 2029.
Required estimated tax payments would not begin before July 1, 2029.
That timing matters more than most people realize. Because if this bill becomes law, 2028 would be the first tax year, but the cash-payment and estimated-tax regime would not fully kick in until 2029.
Status of the bill
As of March 15, 2026, ESSB 6346 has passed the Washington Legislature and was delivered to the governor on March 13, 2026. This post describes the bill as passed by the Legislature, not as final enacted law.
What the bill would do
ESSB 6346 would impose a tax beginning January 1, 2028 on an individual’s Washington taxable income. The rate would be 9.90%. The bill defines “Washington taxable income” as Washington base income further modified by the bill’s state-specific rules, and it starts from federal adjusted gross income rather than simply taxing gross income over a threshold.
Important point:
This is not best understood as a casual “9.9% tax on everything over $1 million.” The actual tax base is Washington taxable income, as defined in the bill.
The bill’s statement of intent says the tax is meant to apply to households with annual adjusted gross income of $1,000,000 or more.
The rollout timeline
January 1, 2028: the tax begins
The bill states that, beginning January 1, 2028, a tax is imposed on the receipt of Washington taxable income, and only individuals are subject to payment of the tax. That means 2028 would be the first year in which liability could arise.
Practical translation: A Washington resident could be generating exposure during 2028 even though no Washington estimated payments would yet be required.
April 2029: first return, first payment
The bill provides that taxpayers owing tax under the new chapter must file their Washington return on or before the date their federal income tax return is required to be filed. It also says the tax must be paid by that filing date regardless of any filing extension. For a calendar-year individual, that means the first Washington return and first payment for tax year 2028 would generally be due around April 15, 2029.
Scroll-stopper: No Washington estimated tax payment would generally be required during 2028 itself. The first real payment event would usually be with the 2028 return in 2029.
Estimated taxes: not in 2028
The bill says each individual with estimated tax above $5,000 who is required under the Internal Revenue Code to make estimated payments must pay Washington estimated tax. It also incorporates the Internal Revenue Code rules for the timing of reporting periods and payment due dates. But then it adds a transition rule: Estimated payments are not required before July 1, 2029. So for tax year 2028, there would be no required Washington estimated payments during 2028.
When would the first estimated payment likely be due?
Because the bill borrows the federal estimated-tax timing framework, and because estimates are not required before July 1, 2029, the first likely Washington estimated payment would be the first regular quarterly due date after that date. That likely means September 15, 2029 would be the first required estimated payment date. That is the most natural reading of the bill as passed, although the Department of Revenue could later issue guidance confirming the mechanics.
Likely timeline
January 1, 2028 — tax begins
April 15, 2029 — first return and first payment for 2028
September 15, 2029 — likely first estimated payment for 2029
The underpayment rules
Once estimated taxes begin, the bill uses a familiar safe-harbor structure. A new penalty provision says estimated tax is “substantially underpaid” if total annual estimated tax payments are less than the tax shown on the return, unless the taxpayer paid in either 90% of the tax shown on the current-year return or 100% of the tax shown on the most recently filed return. The bill also says estimated payments are not required if the annualized estimated tax is less than $5,000.
Plain English: Once estimates start, the usual safe move is to make sure you have paid in at least 90% of this year’s tax or 100% of last year’s tax.
What is the penalty?
The bill applies Washington’s general penalty framework to underpayments of estimated tax. It also adds a specific rule providing that if total estimated tax payments for the year are “substantially underpaid,” there is a 5% penalty on the amount of the underpaid tax.
Another key point: This would not just be an annual-return issue. Once estimates begin, underpaying during the year could create a separate penalty problem.
Why this matters
The headline “tax starts in 2028” is true, but incomplete.
The more useful framing is this: Liability would begin in 2028. The first check would generally be due in 2029. The estimated-tax penalty regime would not begin until later in 2029.
That matters for residency planning, liquidity planning, bonus and withholding strategy, pass-through entity planning, transaction timing, and general cash-flow management.
For founders, executives, investors, and business owners with uneven income, that timing may become one of the most important practical features of the bill. That last point is an inference from the bill’s structure, not express statutory language.
Bottom line
If ESSB 6346 becomes law in its current form:
- January 1, 2028 — tax begins
- April 2029 — first return and first payment
- No required estimated payments before July 1, 2029
- Likely first estimated payment: September 15, 2029
- Safe harbor: 90% of current-year tax or 100% of prior-year tax
Suggested disclaimer
This post describes ESSB 6346 as passed by the Washington Legislature and delivered to the governor as of March 15, 2026. It is not legal or tax advice. The bill may change, and future administrative guidance could affect implementation details.
