What is King County real estate excise tax?

What is King County excise tax?

The Real Estate Excise Tax, or REET, which currently charges a flat 1.78% on all transactions in most of King County, will implement a graduated levy that will significantly impact sellers of homes priced above $1.5 million.

What is real estate excise tax in WA?

Washington state levies a real estate excise tax (REET) on all property sales. This state tax rate is 1.28% of a property’s full selling price.

What is excise tax on real estate?

Real estate excise tax is a tax on the sale of real estate. The tax also applies to transfers of controlling interests (50% or more) in entities that own property in the state. Who is responsible for paying the excise tax? Excise is the responsibility of the seller.

What is Seattle excise tax?

Seattle is location code 1726. The 10.1% sales tax rate in Seattle is collected and then distributed as follows: 6.5% goes to the state of Washington, 2.7% will go to the City of Seattle, and . 9% will go to the Regional Transit Authority. These 3 rates add up to the 10.1% total rate.

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Is excise tax the same as property tax?

Netzer has expressed property taxes on the housing stock in the nation as a whole as an excise tax on housing services. Also in the national accounts prepared by the U.S. Department of Commerce, property taxes are lumped to- gether with sales and manufacturers’ excise taxes in the category, in- direct taxes.

Are real estate excise taxes deductible?

Unfortunately, not. Although the IRS allows you to deduct state sales or income taxes, the rules do not allow you to deduct any state or local excise taxes paid on the sale of your property. …

Who pays WA state excise tax?

For REET purposes, real property is only considered for the flat state tax rate if the buyer indicates it will continue to use the land in a qualifying manner and the county assessor approves the land for such continued use. The county assessor must sign the Notice of Continuance in section 6 of the affidavit.

What is the difference between an excise tax and a sales tax?

Sales tax applies to almost anything you purchase while excise tax only applies to specific goods and services. Sales tax is typically applied as a percentage of the sales price while excise tax is usually applied at a per unit rate.

How is excise tax calculated?

Calculate excise tax based on a dollar amount. For example, if real estate is taxed at $1.50 per $100, and the purchase price of a piece of property is $130,000, then the excise tax is $1,950. The equation is $130,000 divided by 100, followed by $1,300 multiplied by $1.50.

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What is transfer or excise tax?

A transfer tax is a charge levied on the transfer of ownership or title to property from one individual or entity to another. A transfer tax may be imposed by a state, county, or municipality. … Transfer tax is considered an excise tax in some states.

Is house sale considered income?

If your home sale produces a short-term capital gain, it is taxable as ordinary income, at whatever your marginal tax bracket is. On the other hand, long-term capital gains receive favorable tax treatment.

What are closing costs in Washington state?

According to data from ClosingCorp, the average closing cost in Washington is $11,513.23 after taxes, or approximately 2.3% to 2.88% of the final home sale price.

Does Washington state have a capital gains tax on real estate?

WHAT ASSETS WILL BE SUBJECT TO THIS NEW TAX? … Thus, ordinary income, short-term capital gains, dividends, and interest are all excluded from the tax. Certain categories of assets are also excluded, most notably real estate (whether held directly or through a privately owned entity).