Updates and analysis on Washington ESSB 6346 and its impact on startups and investors.
ESSB 6346 strips capital gains from the income tax base, adds back the Washington-taxed gain, and credits the capital gains tax paid. Your gain bears the greater of the two regimes — and for high earners, that means 9.9%, not 7%.
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.
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.
Part-year residents face a two-part calculation under ESSB 6346 — and the $1M standard deduction prorates by income, not days. How §§406 and 315 actually work, with examples.
Initiative 645 is certified for the November 3, 2026 ballot — but the 9.9% tax remains law, effective January 1, 2028. The planning playbook for Washington founders, investors, and high earners.
Does Washington have a state income tax? The 9.9% rate, $1M threshold, January 1, 2028 effective date, the constitutional challenge, and planning moves for founders and investors.
2026 and 2027 are the last two years you can recognize income without Washington's 9.9% income tax. Here is how to use them.
