Washington · tax year 2027 · projected
Washington state income tax 2027
Washington taxes no wages in 2027. It does tax large long-term capital gains at 7% and 9.9%, and from January 1, 2028 a 9.9% income tax applies above a $1 million deduction. Estimate all three and compare your paycheck with twelve other states.
Your wages and gains
Projected result
Why Washington has no wage income tax in 2027
The Washington Department of Revenue's income tax page says plainly: "Washington does not currently have an individual income tax." No employer withholds state income tax from a Washington paycheck, and there is no state return for wages. That is still true for all of 2027. What changed in 2026 is the law for 2028 onward: the Legislature passed Engrossed Substitute Senate Bill 6346, titled "Establishing a tax on millionaires", the Senate on February 16, the House on March 9, final passage on March 11, and the Governor signed it on March 30, 2026 as Chapter 238, Laws of 2026.
Washington also already taxes one kind of income. Since 2022 the capital gains excise tax in chapter 82.87 RCW has applied to individuals' long-term capital gains from the sale or exchange of stocks, bonds, business interests and other long-term assets allocated to Washington, above a standard deduction that the department adjusts for inflation each year. Real estate, assets in certain retirement accounts, livestock, timber, depreciable business assets and a few other categories are exempt, and only the individuals who owe the tax must file.
The capital gains tax: 7%, and 9.9% above $1 million
The tax is 7% of Washington long-term capital gains after the deductions. From tax year 2025, ESSB 5813 (Chapter 421, Laws of 2025) added a second tier: the department's special notice of June 30, 2025 says the first $1 million of taxable Washington capital gains is taxed at 7% and gains above $1 million at 7% plus an additional 2.9%, a combined 9.9%. The 2025 return, the first with tiered rates, was due April 15, 2026.
| Tax year | Standard deduction | Charitable donation threshold | Maximum charitable deduction | Top rate on taxable gains over $1,000,000 |
|---|---|---|---|---|
| 2022 | $250,000 | $250,000 | $100,000 | 7% |
| 2023 | $262,000 | $262,000 | $105,000 | 7% |
| 2024 | $270,000 | $270,000 | $108,000 | 7% |
| 2025 | $278,000 | $278,000 | $111,000 | 9.9% |
| 2026 | $290,000 | $290,000 | $116,000 | 9.9% |
Amounts from the department's "Do you owe capital gains tax?" table. The 2027 amounts had not been published when this page was written, so the calculator uses the 2026 figures for a 2027 estimate and lets you pick an earlier year. The charitable deduction is for donations above the threshold, capped at the maximum shown, and the deduction is per individual, married couple or domestic partnership. A credit is available for income or excise tax paid to another jurisdiction on the same gain, and a business and occupation tax credit applies from tax year 2025.
The 9.9% income tax that starts January 1, 2028
Section 201 of ESSB 6346 imposes, beginning January 1, 2028, a tax equal to 9.90 percent multiplied by an individual's Washington taxable income; only individuals pay it, and no tax is due when taxable income is below zero. Washington taxable income is Washington base income, which starts from federal adjusted gross income and applies the modifications in Part III of the act, less the standard deduction in section 314: $1,000,000 per individual, or a combined $1,000,000 for spouses or state registered domestic partners whether they file joint or separate returns. The deduction is reduced for part-year and nonresidents in proportion to Washington income, and section 316 indexes it for inflation starting October 2029 and every odd-numbered year after.
Two modifications matter most. Section 302 deducts long-term capital gains from base income (and adds back long-term losses) because those gains are taxed under chapter 82.87, and section 205 adds a credit for the Washington capital gains tax paid, so a gain is not taxed under both regimes. Section 203 gives a credit for income taxes due to another state on the same income. The department's FAQ says the first returns will be due in April 2029 and that guidance on filing, forms and administration will follow; nothing about the tax applies to 2026 or 2027 income.
Same paycheck, other states
Table values come from the projected 2027 calculator used on each state page, for a single filer with $75,000 of wages and no dependents. A state's figure is the state income tax only, before local taxes, credits and federal tax.
| State | Projected 2027 tax on $75,000 (single) | Effective rate |
|---|---|---|
| Washington | $0.00 | 0% |
| Illinois | $3,567.71 | 4.76% |
| Virginia | $3,472.53 | 4.63% |
| New York | $3,386.00 | 4.51% |
| Georgia | $2,994.00 | 3.99% |
| Michigan | $2,936.75 | 3.92% |
| New Jersey | $2,596.00 | 3.46% |
| Colorado | $2,591.60 | 3.46% |
| Kentucky | $2,507.40 | 3.34% |
| North Carolina | $2,483.78 | 3.31% |
| Pennsylvania | $2,302.50 | 3.07% |
| Mississippi | $2,126.25 | 2.83% |
| Ohio | $1,619.00 | 2.16% |
Worked example
A single Washington resident earns $75,000 in wages and, in the same year, sells stock for a $1,500,000 long-term gain. State income tax on the wages: $0.00 (the same wages would owe $3,386.00 in New York). Capital gains tax at the 2026 amounts: $1,500,000 less the $290,000 standard deduction leaves $1,210,000 of taxable gain; 7% of the first $1,000,000 is $70,000 and 2.9% of the remaining $210,000 is $6,090, so the tax is $76,090, an effective 5.07% of the gain. Had the sale happened in 2024, before the second tier, the tax would have been 7% of $1,230,000, or $86,100, because the deduction was smaller and the whole gain was taxed at 7%. From 2028 the wages alone would still owe nothing: $75,000 is far below the $1,000,000 deduction, and the gain would be removed from base income under section 302. A married couple with $1,250,000 of other income in 2028 would owe 9.9% of $250,000, or $24,750.
Who this is for, and what it does not cover
It is for people checking whether Washington taxes their pay or their investment sales in 2027 and what changes in 2028. It does not cover the business and occupation tax, sales tax, property tax, the allocation of gains between states, the qualified family-owned small business deduction, estimated payments, penalties or the department's rules for the 2028 tax, which were not written when this page was published. The comparison states use the same projected 2027 figures as their own pages.
Common mix-ups
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Often assumedWashington has no income tax of any kind and never will.
What the source saysThe Department of Revenue says Washington does not currently have an individual income tax, and that beginning January 1, 2028 a 9.9% income tax applies to individuals and married couples filing jointly with adjusted gross income above $1 million under Senate Bill 6346. [1]
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Often assumedThe 2028 Washington tax is 9.9% of everything a millionaire earns.
What the source saysSection 314 of the session law gives a standard deduction of $1,000,000 per individual, combined for spouses, and section 201 applies 9.90 percent to Washington taxable income after that deduction. [2]
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Often assumedWashington capital gains are taxed at a flat 7%.
What the source saysThe department's special notice says that beginning with tax year 2025 the first $1 million of taxable Washington capital gains is taxed at 7% and gains above $1 million at 7% plus an additional 2.9%. [3]
- Washington Department of Revenue: Income tax
- ESSB 6346, Chapter 238, Laws of 2026 (session law)
- Washington Department of Revenue: special notice, new tiered rates for the capital gains tax
Checked against these sources on .
Frequently asked questions
Does Washington have a state income tax in 2027?
Not on wages. The Department of Revenue says Washington does not currently have an individual income tax. Washington does tax long-term capital gains above a deduction ($290,000 for 2026), and a 9.9% income tax on income above $1 million takes effect January 1, 2028, so 2027 is the last year with no income tax of any kind on high earners.
What is the Washington capital gains tax rate?
7% on long-term capital gains allocated to Washington after the standard deduction, plus, from tax year 2025, an additional 2.9% on taxable gains above $1,000,000, a combined 9.9% on that tier (ESSB 5813, Chapter 421, Laws of 2025). The deduction is $278,000 for 2025 and $290,000 for 2026.
What is the new Washington income tax that starts in 2028?
ESSB 6346, Chapter 238, Laws of 2026, imposes a tax of 9.90% on Washington taxable income beginning January 1, 2028. Taxable income is federal adjusted gross income with the act's modifications, less a $1,000,000 standard deduction per individual ($1,000,000 combined for spouses or registered domestic partners). The first returns are due in April 2029.
Is the $1 million threshold an exemption or a cliff?
A deduction. Section 314 of the act lets a taxpayer deduct $1,000,000 from Washington base income, so the 9.9% applies only to income above that line, and section 201 says no tax is due when taxable income is below zero. The deduction is indexed for inflation from October 2029.
Do capital gains get taxed twice under the 2028 law?
The act's section 302 removes long-term capital gains from Washington base income and adds back long-term losses, because those gains are taxed under the separate capital gains excise tax in chapter 82.87 RCW, and section 205 gives a credit for Washington capital gains tax paid.
How much would I save on wages versus Oregon, California or New York?
On $75,000 of wages for a single filer with no dependents the projected 2027 state income tax is $3,386.00 in New York, $3,567.71 in Illinois and $3,472.53 in Virginia, against $0.00 in Washington. Oregon and California are not among the twelve comparison states in the calculator.
When is the Washington capital gains return due?
On the same day as your federal income tax return, with payment due April 15 or the next business day; from tax year 2026 you may prepay up to six months early. Only individuals who owe the tax must file, electronically, with a copy of the federal return.
Is this an estimate of my final tax?
No. Wages are projected at $0 from law enacted as of November 11, 2026; the capital gains figure uses the 2026 deduction because the 2027 inflation-adjusted amount is not yet published; the 2028 figure applies the statute before the Department of Revenue has issued rules.
Sources
Retrieved 2026-11-11. Each link was opened and checked against the claim next to it.
- Washington Department of Revenue: Income tax: "Washington does not currently have an individual income tax"; the 9.9% tax from January 1, 2028 under Senate Bill 6346; first returns due in April 2029.
- Washington Department of Revenue: Frequently asked questions about income tax: who is subject to the 2028 tax, effective date, pending guidance.
- ESSB 6346, Chapter 238, Laws of 2026 (session law PDF): section 201 (9.90 percent of Washington taxable income from January 1, 2028), sections 203 and 205 (credits), section 302 (capital gains removed from base income), section 314 ($1,000,000 standard deduction), sections 315 and 316 (nonresident proration and indexing from October 2029).
- Washington Legislature: SB 6346 bill summary: title "Establishing a tax on millionaires", passage dates, Governor signed March 30, 2026, C 238 L 26.
- Washington Department of Revenue: Capital gains tax: 7% rate, exemptions, filing and payment rules, chapter 82.87 RCW.
- Washington Department of Revenue: Special notice, new tiered rates for Washington's capital gains tax (June 30, 2025): 7% on the first $1 million of taxable gains and an additional 2.9% above it from tax year 2025, ESSB 5813, Chapter 421, Laws of 2025.
- Washington Department of Revenue: Do you owe capital gains tax? (updated amounts table): standard deduction, charitable threshold and cap, 2022 to 2026.
Not tax advice
This page is general information, not tax, legal or financial advice. Figures for 2027 are projected from law enacted as of November 11, 2026 and from the latest published deduction amounts; indexed amounts, rules and new legislation can change them, and the Department of Revenue has not yet issued rules for the 2028 income tax. Confirm anything that matters with the department or a tax professional before you act. Everything runs in your browser; nothing you enter is sent anywhere.