Washington Real Estate Excise Tax: What Home Sellers in Edmonds and the Seattle Area Need to Know

If you are preparing to sell a home in Edmonds, Shoreline, Lynnwood, or anywhere in Snohomish County or King County, one of the most important closing costs to understand is the Washington State Real Estate Excise Tax. Known as REET, this is a tax on the sale of real property, and it is typically one of the largest expenses a seller faces at the closing table.

Understanding how REET works, what you will owe, and whether any exemptions apply can help you accurately calculate your net proceeds before you ever list your home.

What Is the Washington State Real Estate Excise Tax

The Washington State Real Estate Excise Tax is a tax imposed on the transfer of real property. Real estate excise taxes are typically the responsibility of the property seller, not the buyer, although the buyer is liable if the tax is not paid.

A "sale" refers to any transaction where ownership or title to real estate is transferred in exchange for valuable consideration. This includes traditional home sales, transfers of investment property, and certain ownership changes in entities that hold real estate.

REET is collected at closing by the county treasurer. Your escrow or title company will calculate the amount owed and remit it on your behalf as part of the closing process.

Current Washington State REET Rates

The state uses a graduated REET tax scale, with rates ranging from 1.1% to 3.0% based on the selling price of the property.

This graduated structure means you do not pay the highest rate on your entire sale price. Each tier applies only to the portion of the sale price within that range.

The four-bracket graduated state REET rate structure is:

1.10% on the first $525,000;

1.28% on $525,000.01 to $1,525,000;

2.75% on $1,525,000.01 to $3,025,000;

3.00% on amounts above $3,025,000.

Here is how that plays out for a typical Edmonds home sale:

• First $525,000 of the sale price: taxed at 1.10%

• The portion from $525,001 to $1,525,000: taxed at 1.28%

• The portion from $1,525,001 to $3,025,000: taxed at 2.75%

• Any amount above $3,025,000: taxed at 3.00%

  
  

The tax applies to each bracket separately, so a home selling for $600,000 would be taxed at 1.10% on the first $525,000 and 1.28% on the remaining $75,000.

Local REET Rates in Snohomish County and King County

The state rate is only part of what sellers owe. Each Washington county levies a local surcharge authorized by RCW 82.46.010 (first-quarter, 0.25%) and RCW 82.46.035 (second-quarter, another 0.25%). Most counties that have adopted Growth Management Act planning levy both quarters for a combined local rate of 0.50%.

Both Snohomish County and King County fall under the Growth Management Act, which means sellers in Edmonds, Shoreline, Mountlake Terrace, Lynnwood, and surrounding communities typically pay the combined local rate of 0.50% on top of the state graduated rates.

The local surcharge is always calculated on the full gross selling price. There are no brackets or thresholds at the local level.

For an Edmonds home selling at $850,000, the total REET calculation looks like this:

State REET:

• 1.10% on $525,000 = $5,775

• 1.28% on the remaining $325,000 = $4,160

• State total: $9,935

Local REET (Snohomish County at 0.50%):

• 0.50% on $850,000 = $4,250

Total REET due at closing: approximately $14,185

This is a significant closing cost that every seller should factor into their net proceeds estimate before listing.

Who Pays REET in Washington State

By practice, you as the seller pay REET at closing. For deeded transfers, payment is due to the county treasurer on the date of sale. If unpaid, the buyer may be liable for the tax.

While buyers are not typically responsible for REET, it is worth noting that the calculation is based on the full selling price, including any debt the buyer assumes. If a buyer takes over an existing mortgage as part of the transaction, that assumed debt is included in the taxable sale price.

How REET Is Paid at Closing

Your title or escrow company handles the REET calculation and payment on your behalf. You will sign a REET Affidavit as part of closing, which documents the sale and confirms the tax has been calculated correctly.

Expect a $5 state technology fee on each transfer, and an extra $5 affidavit processing fee if you claim a full exemption. If REET is late, penalties apply at 5% after one month, 10% after two months, and 20% after three months, plus interest that accrues monthly.

Because REET is collected at closing and administered through escrow, sellers in the Edmonds market rarely need to handle this directly. However, you should always review your closing disclosure carefully to confirm the calculation is accurate.

Are There Exemptions to Washington REET

Yes. Several transactions qualify for a full or partial exemption from REET. Common exemptions include:

• Transfers between spouses or domestic partners as part of a divorce settlement

• Transfers that qualify as gifts with no money or value exchanged

• Certain transfers to government agencies or qualifying nonprofit organizations

• Transfers of property into a revocable living trust where the transferor remains the beneficiary

A new REET exemption was created for the sale of qualified space in an affordable housing development to a qualifying organization for an exempt community purpose, effective January 1, 2026.

General residential sales do not qualify for exemption. If you are unsure whether your situation qualifies, consult with a real estate attorney or a knowledgeable Edmonds real estate agent before closing.

What the Graduated Rate Means for Edmonds and Seattle Area Sellers

Because Edmonds real estate prices have remained strong, many sellers find themselves in the second tier of the state REET schedule. Homes in the Edmonds Bowl, waterfront properties along the Puget Sound, and larger single-family homes across Snohomish County frequently sell in the $800,000 to $1,200,000 range, which means most of the taxable sale price falls in the 1.28% state bracket.

Sellers of higher-end properties approaching or exceeding $1.5 million should be aware that the 2.75% tier applies to the portion above that threshold. For luxury listings in the Edmonds waterfront market or upscale neighborhoods throughout North Seattle and King County, this can represent a meaningful increase in closing costs.

Understanding where your expected sale price falls within the REET tiers is an important part of accurate net proceeds planning.

How REET Affects Your Net Proceeds as a Seller

Sellers frequently focus on commission and overlook the impact of REET on their bottom line. For most Edmonds and Snohomish County home sales, REET will represent one of the top two or three closing costs.

When working with sellers, I calculate an estimated net proceeds statement that includes:

• State REET by tier

• Local REET (Snohomish or King County)

• Title and escrow fees

• Seller-paid closing costs

• Any negotiated credits to the buyer

This gives you a realistic picture of what you will walk away with before you agree to a sale price. Knowing your REET liability in advance also helps you evaluate offers more accurately, especially if you receive offers at different price points.

Common Mistakes Sellers Make Regarding REET

Underestimating the total. Many sellers only consider the state rate and forget that local REET adds another 0.50% on the full sale price in most of the greater Seattle area.

Failing to account for assumed debt. If the buyer assumes any portion of your existing mortgage, that amount is included in the taxable sale price.

Assuming exemptions apply. Gift and family transfer exemptions have specific requirements. Do not assume your transaction qualifies without confirming with a real estate professional or attorney.

Waiting until closing to review the number. By the time you sign closing documents, there is limited ability to adjust your net. Calculate REET early, before you accept an offer.

Frequently Asked Questions About Washington Real Estate Excise Tax

Who pays real estate excise tax in Washington State?

The seller pays REET at closing in Washington. The buyer can be held liable if the seller fails to pay, but by standard practice the seller is responsible.

Is there a REET exemption for first-time home buyers in Washington?

No. Washington does not offer a general REET exemption for first-time buyers on standard residential resale transactions. Exemptions exist for specific situations such as gifts and certain government or nonprofit transfers.

What is the REET rate on a home that sells for $900,000 in Edmonds?

At $900,000, the state REET would be approximately $10,855 (1.10% on the first $525,000 and 1.28% on the remaining $375,000). Adding Snohomish County's 0.50% local rate of $4,500 brings the total to approximately $15,355.

Does REET apply to investment properties and land in Washington?

Yes. REET applies to all real property transfers in Washington, including investment properties and vacant land. Agricultural land and timberland are taxed at a flat 1.28% rate rather than the graduated schedule.

How often do REET thresholds change in Washington?

The price thresholds are adjusted by the state Department of Revenue every four years. Always confirm the current brackets before listing, as threshold adjustments affect where each rate tier begins.

Is REET negotiable between buyer and seller?

Technically, the parties can negotiate who pays REET as part of the purchase agreement. However, by custom and standard practice in Washington, the seller pays. Buyers rarely agree to cover this cost unless it is part of a specific negotiated concession.

Work With a Local Edmonds Real Estate Expert

Understanding Washington real estate excise tax is one piece of the larger picture when it comes to selling your home. Accurate net proceeds planning, strategic pricing, and local market knowledge all work together to help you get the best result from your sale.

I am Matt Michel, a real estate agent based in Edmonds, WA. I work with sellers throughout Edmonds, Shoreline, Mountlake Terrace, Lynnwood, and the broader Snohomish County and North Seattle markets. If you are preparing to sell and want a clear picture of your total closing costs, including REET, I am happy to walk you through the numbers before you list.

Contact me today for a no-pressure consultation.