If you are trying to decide whether to sell your home year or next, one of the variables you might want to consider and prepare for is the new 2020 Real Estate Excise Tax (REET). Currently the Washington state excise tax is 1.28% and then local municipalities add their excise tax on top of that, with most cities in our area adding .5% so the average total REET is 1.78%. Effective 1/1/2020 this will change to a new sliding scale based upon the home’s sales price. Depending on your price point you might want to sell before or after the end of the year.
New Progressive REET Rates
| Home Sales Price | REET (including standard .5% municipality tax) |
| 0-$500,000 | 1.60% You will pay less in 2020 |
| $501,000-$1,500,000 | 1.78% You will pay less in 2020 |
| $1,501,000 – $3,000,000 | 3.25% You will more in 2020 |
| $3,000,000 + | 3.50% You will more in 2020 |
Here are some sample calculations compared to 2019
| Home Sales Price | 2019 REET | 2020 REET |
| $500,000 | $500,000*1.78%=$8,900 | $500,000*1.60%=$8,000 |
| $750,000 | $750,000*1.78%=$13,350 | $500,000*1.60%=$8,000 $250,000*1.78%=$4,450 Total =$12,450 |
| $1,500,000 | $1,500,000*1.78%=$26,700 | $500,000*1.60%=$8,000 $1,000,000*1.78%=$17,800 Total =$25,800 |
| $2,500,000 | $2,500,000*1.78%=$44,500 | $500,000*1.60%=$8,000 $1,000,000*1.78%=$17,800 $1,000,000*3.25%=$32,500 Total =$58,300 |
| $3,500,000 | $3,500,000*1.78%=$62,300 | $500,000*1.60%=$8,000 $1,000,000*1.78%=$17,800 $1,500,000*3.25%=$48,750 $500,000*3.50%=$17,500 Total =$92,050 |
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