Family-Owned Business Interest

From the 2024 DOR Tax Exemption Study

83.100.048 - Family-Owned Business Interest Description Qualified family-owned business interests may be deducted from the taxable estate if certain conditions are met, including: - The value of the qualified family-owned business interests exceeds 50% of the Washington taxable estate determined without regard to the deduction for the applicable exclusion amount. - The decedent must have been a citizen of the U.S. and a qualified family- owned business acquired by any qualified hair. - The value of the qualified family-owned business interests is not more than $6 million. - During the eight years ending on the date of the decedent's death, there have been five or more years of material participation related to the operation of the business. The deduction is limited to $2.5 million and applies only to decedents dying on or after January 1, 2014. Purpose Ensures surviving family members do not need to sell family-owned business assets to pay estate taxes. Taxpayer ($ in millions): savings FY 2024 FY 2025 FY 2026 FY 2027 State Taxes $1.700 $1.700 $1.700 $1.700 Local Taxes $0.000 $0.000 $0.000 $0.000 Repeal of Repealing this deduction would increase revenues. exemption Potential ($ in