Howard Schultz published an op-ed in the Wall Street Journal on Monday titled "Seattle Turns Hostile to the Great Businesses It Made." The political commentary has already generated more heat than light. I want to focus on something else: the practical questions Washington founders and executives should be asking their tax counsel right now — regardless of how they feel about the mayor or about Schultz.
Three data points sit on the table together. Jeff Bezos moved to Miami in 2023, the year Washington's capital gains tax took effect. Schultz announced his move to Miami in March 2026, the same legislative cycle that produced ESSB 6346 — Washington's new 9.9% income tax on household income above $1 million, effective January 1, 2028. And Starbucks announced last month that it is opening a Nashville corporate office that will scale to 2,000 workers, on a $100 million Tennessee investment — more than half the size of its Sodo headquarters workforce.
None of those is a smoking gun on its own. Together they are a trend. And trends produce planning questions.
Here are the questions clients have been asking me this week.
1. Is leaving Washington actually the answer?
For some clients, yes. For most, the right answer is more nuanced — and the analysis is more demanding than people expect. A few realities founders and executives should internalize before they start shopping for Florida real estate:
- Domicile change is a documented legal change, not a vibe. Selling a Seattle house and buying a Miami one does not, by itself, change your domicile. Washington's Department of Revenue will look at where you actually live, where your family is, where you vote, where your driver's license is issued, where your doctors and dentists are, where you keep your most personal belongings, and where you say you live on every form you sign. I walk through the domicile-change framework here.
- "Statutory residency" is a second, independent test. Even if you change domicile cleanly, spending more than 182 days in Washington with a permanent place of abode still gets you taxed as a Washington resident. The two tests stack.
- Audit risk is real. When state revenue departments are short on cash, residency audits are how they raise it. New York and California have run this playbook for decades. Washington's revenue staff is going to learn quickly.
The right question is not "should I move?" The right question is "given my income mix, my QSBS posture, my family situation, and my actual willingness to change my life — what is the most tax-efficient five-year plan?" Sometimes the answer is "move." Sometimes it is "stay, restructure, time the exit."
2. What about my founder stock and QSBS?
This is the most common question I am getting from clients with significant private company equity. Three points to keep in mind:
- QSBS still works at the federal level. Section 1202's 100% exclusion remains in place, and the One Big Beautiful Bill expanded it — tiered holding periods, a $75 million asset test, and an inflation-adjusted per-issuer cap. My summary of the OBBBA QSBS changes is here.
- Washington's 9.9% capital gains tax does not apply to exempt QSBS gain. Washington follows federal law.
- ESSB 6346 sweeps in capital gains income above $1 million at the new 9.9% rate. So a Washington founder with a $10 million non-QSBS sale in 2029 owes Washington 9.9% on roughly $9 million of that gain. The timing analysis for QSBS sales and a Washington move is here.
If your liquidity event is more than three years out, you have time to plan. If it is inside two years, the conversation is more urgent.
3. What about my company itself?
Schultz's op-ed is partly about businesses moving, not just individuals. That's a separate analysis, and one that depends heavily on the entity structure, where revenue is sourced, and where employees actually work. A C-corporation does not pay Washington's new 9.9% income tax — that is a tax on individual income. But the founders and key executives do, on the income they draw from the company. And the company itself still owes Washington's business and occupation tax on gross receipts.
For pre-revenue startups, the entity question (Delaware C-corp vs. Washington LLC vs. something else) is mostly unchanged. For mature operating companies with mobile workforces, the conversation about where new hires sit, where the next office goes, and where the CEO lives is a legitimate strategic question now, not just a tax question.
4. Can I just wait and see?
You can. But the planning window is narrower than people think.
ESSB 6346 takes effect January 1, 2028. That sounds far away. It is not. If you want to be a non-Washington resident for the full 2028 tax year, you need to be domiciled elsewhere by December 31, 2027. Working backward from that:
- 2026: Diligence the new state. Visit. Understand the costs you don't think about — insurance, schools, climate, distance from family.
- 2027: Execute the move. Buy or lease the new home. Change the driver's license, the voter registration, the bank accounts, the doctors. Update the estate plan. Start tracking days.
- 2028: Live the new life. Stay under 182 days in Washington. Keep clean records.
That is a real two-year project, not a December scramble. Clients who wait until late 2027 to start are not going to make a clean 2028 break.
5. What is the constitutional challenge worth?
There is a serious constitutional challenge to ESSB 6346 working through the courts. I have written about the merits of that challenge separately. The short version: there are real arguments under Culliton and the way the Washington Supreme Court reframed the income-as-property issue in Quinn. There are also real reasons to think the current court may not be persuaded.
Treat the litigation as a tail benefit, not a plan. If you would not have moved without the constitutional challenge, do not let the pendency of the challenge keep you from moving. If the tax is struck down, your worst case is that you moved to Miami for nothing. That is a recoverable mistake. The reverse mistake — declining to plan, then paying 9.9% on a nine-figure exit — is not.
The actual point
Schultz's op-ed is not really news. The news is that the Wall Street Journal is treating capital flight from Washington as a national business story, four months before ESSB 6346 takes effect. That signals to executives and founders nationwide that the question is now legitimately on the table.
For Washington founders, executives, and investors with meaningful equity exposure, this is the year to do the planning work — not the year of the sale, and certainly not December 2027.
If you want to walk through your own facts, grab a 20-minute call here. No charge for the first conversation. I will tell you whether you have a real planning problem, a manageable one, or none at all.
