Trust Planning and the Washington State Capital Gains Tax

Seattle University Law Review SUpra

27 Pages Posted: 28 Jun 2021 Last revised: 16 Oct 2021

Date Written: October 15, 2021


On April 25, 2021, the Washington State Legislature enacted a new state capital gains tax. Before now, Washington state has been one of the few states that does not impose a tax on either income or capital gains. Because of limitations imposed by the Washington State Constitution, the legislature has been forced to characterize the tax as an excise tax, rather than treat it as an income tax as would the federal government and every other state. Based on the statute’s structure and its presentation as an excise tax, whether intentionally or unintentionally, the legislature appears to have excluded both the trustees and beneficiaries of non-grantor trusts from being subject to the tax. This Article reviews the difference between grantor and non-grantor trusts, examines the apparent discrepancy between the two under the statute, and explores tax strategies planners and clients might consider pursuing in the wake of the new tax.

Keywords: Washington, capital gains, income, tax, trust, grantor, estate planning

Suggested Citation

Coppieters, Jadrian, Trust Planning and the Washington State Capital Gains Tax (October 15, 2021). Seattle University Law Review SUpra, Available at SSRN: or

Jadrian Coppieters (Contact Author)

Scarff Law Firm PLLC ( email )

3035 Island Crest Way
Suite 201
Mercer Island, WA 98040
United States
206-236-1500 (Phone)
206-905-5912 (Fax)


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