BILL REQ. #:  S-0347.1 

Read first time 01/22/2007.   Referred to Committee on Ways & Means.

     AN ACT Relating to increasing the amount of the applicable exclusion for the estate tax; and amending RCW 83.100.020 and 83.100.050.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1   RCW 83.100.020 and 2005 c 516 s 2 are each amended to read as follows:
     As used in this chapter:
     (1) "Decedent" means a deceased individual;
     (2) "Department" means the department of revenue, the director of that department, or any employee of the department exercising authority lawfully delegated to him by the director;
     (3) "Federal return" means any tax return required by chapter 11 of the Internal Revenue Code;
     (4) "Federal tax" means a tax under chapter 11 of the Internal Revenue Code;
     (5) "Gross estate" means "gross estate" as defined and used in section 2031 of the Internal Revenue Code;
     (6) "Person" means any individual, estate, trust, receiver, cooperative association, club, corporation, company, firm, partnership, joint venture, syndicate, or other entity and, to the extent permitted by law, any federal, state, or other governmental unit or subdivision or agency, department, or instrumentality thereof;
     (7) "Person required to file the federal return" means any person required to file a return required by chapter 11 of the Internal Revenue Code, such as the personal representative of an estate;
     (8) "Property" means property included in the gross estate;
     (9) "Resident" means a decedent who was domiciled in Washington at time of death;
     (10) "Taxpayer" means a person upon whom tax is imposed under this chapter, including an estate or a person liable for tax under RCW 83.100.120;
     (11) "Transfer" means "transfer" as used in section 2001 of the Internal Revenue Code. However, "transfer" does not include a qualified heir disposing of an interest in property qualifying for a deduction under RCW 83.100.046 or ceasing to use the property for farming purposes;
     (12) "Internal Revenue Code" means, for the purposes of this chapter and RCW ((83.110.010)) 83.110A.010, the United States internal revenue code of 1986, as amended or renumbered as of January 1, 2005;
     (13) "Washington taxable estate" means the federal taxable estate, less: (a) One million five hundred thousand dollars for decedents dying before January 1, 2006; and (b) two million dollars for decedents dying on or after January 1, 2006; and (c) the amount of any deduction allowed under RCW 83.100.046. The amounts referenced in (a) and (b) of this subsection must be increased by the growth factor for decedents dying on or after January 1, 2008, and subsequently increased by the growth factor each January 1st thereafter; ((and))
     (14) "Federal taxable estate" means the taxable estate as determined under chapter 11 of the internal revenue code without regard to: (a) The termination of the federal estate tax under section 2210 of the Internal Revenue Code or any other provision of law, and (b) the deduction for state estate, inheritance, legacy, or succession taxes allowable under section 2058 of the internal revenue code; and
     (15) "Growth factor" means the previous fiscal year's average consumer price index, using the official current base, compiled by the bureau of labor statistics, United States department of labor for the state of Washington. If the bureau of labor statistics develops more than one consumer price index for areas within the state, the index covering the greatest number of people, covering areas exclusively within the boundaries of the state, and including all items shall be used for the growth factor.

Sec. 2   RCW 83.100.050 and 2005 c 516 s 5 are each amended to read as follows:
     (1) A Washington return must be filed if: (a) A federal return is required to be filed; or (b) for decedents dying prior to January 1, 2006, the gross estate exceeds one million five hundred thousand dollars; or (c) for decedents dying on or after January 1, 2006, the gross estate exceeds two million dollars. The amounts referenced in (b) and (c) of this subsection shall be increased by the growth factor for decedents dying on or after January 1, 2008, and subsequently increased by the growth factor each January 1st thereafter.
     (2)(a) A person required to file a federal return shall file with the department on or before the date the federal return is required to be filed, including any extension of time for filing under subsection (4) of this section, a Washington return for the tax due under this chapter.
     (b) If no federal return is required to be filed, a taxpayer shall file with the department on or before the date a federal return would have been required to be filed, including any extension of time for filing under subsection (5) of this section, a Washington return for the tax due under this chapter.
     (3) A Washington return delivered to the department by United States mail shall be considered to have been received by the department on the date of the United States postmark stamped on the cover in which the return is mailed, if the postmark date is within the time allowed for filing the Washington return, including extensions.
     (4) In addition to the Washington return required to be filed in subsection (2) of this section, a person, if required to file a federal return, shall file with the department on or before the date the federal return((,)) is required to be filed a copy of the federal return along with all supporting documentation. If the person required to file the federal return has obtained an extension of time for filing the federal return, the person shall file the Washington return within the same time period and in the same manner as provided for the federal return. A copy of the federal extension shall be filed with the department on or before the date the Washington return is due, not including any extension of time for filing, or within thirty days of issuance, whichever is later.
     (5) A person who is required to file a Washington return under subsection (2) of this section, but is not required to file a federal return, may obtain an extension of time for filing the Washington return as provided by rule of the department.