How much real estate excise tax does a seller pay in Washington?
By Austin Hellickson, Managing Broker, LPT Realty5 min read
In Washington the seller normally pays the real estate excise tax, collected by escrow at closing. For sales through December 31, 2026, the state rate is 1.1% on the first $525,000 of the price, 1.28% on the portion up to $1,525,000, 2.75% up to $3,025,000 and 3% above that, plus a flat local rate set by your city or county. On January 1, 2027 the state brackets move up to $551,000, $1,551,000 and $3,051,000, and the rates stay the same.
Who pays it
The seller. Washington’s Department of Revenue puts it plainly: usually the seller pays, and if the seller doesn’t, the buyer becomes responsible. The purchase and sale forms most brokers here use assign it to the seller as well, so unless a buyer agrees in writing to cover it, plan on it coming out of your proceeds.
You won’t write a separate check. Escrow calculates the tax, takes it from the sale proceeds, and files a Real Estate Excise Tax Affidavit with the county treasurer. The deed doesn’t record until the tax is paid, which is why it never gets forgotten.
The state brackets through December 31, 2026
Since 2020 the state portion has been graduated. It works the way income tax brackets do: each rate applies only to the slice of the price that falls inside its bracket.
| Portion of the sale price | State rate |
|---|---|
| $525,000 or less | 1.10% |
| $525,000.01 to $1,525,000 | 1.28% |
| $1,525,000.01 to $3,025,000 | 2.75% |
| Above $3,025,000 | 3.00% |
A house that sells for $700,000 pays 1.1% on the first $525,000 and 1.28% on the remaining $175,000. That’s $5,775 plus $2,240, or $8,015 in state tax, before the local rate.
Classified farm and timber land is taxed at a single flat rate instead.
What changes on January 1, 2027
The bracket thresholds are adjusted on a schedule written into state law. The first adjustment took effect in 2023, and the next one takes effect January 1, 2027. The Department of Revenue has published the new thresholds.
| Portion of the sale price | State rate from January 1, 2027 |
|---|---|
| $551,000 or less | 1.10% |
| $551,000.01 to $1,551,000 | 1.28% |
| $1,551,000.01 to $3,051,000 | 2.75% |
| Above $3,051,000 | 3.00% |
The rates don’t move. Only the lines between them do, so a little more of each sale price is taxed at the lower rate.
It helps to see how little that is. These are hypothetical round prices, state tax only:
| Sale price | Closing in 2026 | Closing in 2027 |
|---|---|---|
| $450,000 | $4,950 | $4,950 |
| $700,000 | $8,015 | $7,968.20 |
| $1,600,000 | $20,637.50 | $20,208.50 |
Below $525,000, nothing changes at all. At $700,000 the saving is under fifty dollars. Holding a house for extra months to catch the new thresholds almost never pays for the mortgage, taxes and insurance you carry in the meantime. If your closing happens to straddle New Year’s anyway, ask escrow which date controls for your sale.
The local layer your city or county adds
On top of the state tax, cities and counties can levy their own excise tax, typically in two pieces of up to a quarter percent each, known locally as REET 1 and REET 2. Many cities in Pierce and King County charge both. Unlike the state portion, the local rate is flat: one percentage applied to the entire sale price.
At a half percent, the $700,000 house above adds $3,500, for a total around $11,515 before the small affidavit processing fees.
Which local rate applies depends on the tax jurisdiction the parcel sits in, and a mailing address can mislead you. South Hill has Puyallup addresses and sits in unincorporated Pierce County. Graham and Spanaway are unincorporated too, so the county’s rate applies there. The location code on your property tax statement, or on the Pierce County Assessor-Treasurer or King County parcel lookup, tells you which jurisdiction the house is in, and the Department of Revenue publishes the local rate for each code.
When it’s paid, and why a cash sale pays the same tax
The tax is due on the date of sale, which on an ordinary purchase means closing. Escrow handles the timing. If a sale is ever handled without escrow, don’t let the affidavit sit: once a month goes by unpaid, interest is charged all the way back to the date of sale and penalties start to stack on top.
The tax is based on the selling price. How the buyer pays has nothing to do with it. A cash investor’s offer is taxed on exactly the same scale as a financed buyer’s offer, and a lower price produces a lower tax only because the price itself is lower.
Where cash offers sometimes differ is in who covers the costs. A buyer may offer to pay some or all of the seller’s closing costs, and occasionally that includes the excise tax. That concession is worth real money, so count it. The Compare Both page puts excise tax, escrow and title on the same line for each path so the nets can be read against each other.
When a house passes to heirs through an estate, the transfer to the heirs generally isn’t a taxable sale, but when the estate sells the house to a buyer, that sale is taxed like any other; selling a house still in probate covers the rest of that process. A rental sold with tenants in place pays the same tax as a vacant house; what the tenants change is who buys it, which is the subject of selling a rental while the tenants live there.
Running a rough estimate yourself
You can get close with a pencil. Take the price you expect, apply 1.1% to the part up to the first threshold and 1.28% to the part above it, then add the local rate on the whole price. Unless the price tops the second threshold ($1,525,000 through 2026, $1,551,000 from January 1, 2027), only those first two state brackets come into play.
Then do it twice: once at the price a listing might bring, and once at the number a cash buyer might offer. The difference in tax between the two is usually small next to the difference in price, but it runs in the cash offer’s favor, and an honest comparison counts it along with the commission, the repairs and the months of carrying costs.
Your pencil figure will be a little off from the final one because of processing fees and rounding. Escrow’s number is the one that counts, and a title or escrow officer will usually give you a preliminary figure well before closing if you ask.
Washington’s capital gains tax and your house
Washington has a state capital gains tax, and sellers ask about it often. Real estate is excluded, so selling a house here doesn’t trigger it, and that holds for a rental as well as a home you lived in.
Federal tax is a separate matter. The IRS has its own rules for gains on the sale of a primary residence, and different ones for rentals, including recapture of depreciation you’ve taken. The excise tax you pay may also count as a selling expense on your federal return. A CPA or tax preparer is the right person to run those numbers, and it’s worth doing before you accept an offer, since the answer can shape which offer nets you more.
Everything in this article is general. Escrow will prepare the exact figure for your sale, the Department of Revenue publishes current rates and thresholds at dor.wa.gov, and your tax professional covers the rest.
