6346-S.E AMH REEV TAYT 573

ESSB 6346 - H AMD TO H AMD (H-3793.3/26) 2603

NOT ADOPTED 03/09/2026

On page 13, after line 20 of the striking amendment, insert the following:

"NEW SECTION. Sec. ECONOMIC SUBSTANCE. (1) The department may disregard transactions lacking economic substance for purposes of determining liability under this chapter.

(2) A transaction lacks economic substance if:

(a) It does not meaningfully change the taxpayer’s economic position; and

(b) It lacks substantial non-tax purpose.

NEW SECTION. Sec. PASSIVE LOSS LIMITATION. Passive losses may not offset income taxable under this chapter beyond limitations allowed under federal law."

Renumber the remaining sections consecutively and correct any internal references accordingly.

On page 41, after line 5 of the striking amendment, insert the following:

"NEW SECTION. Sec. 712. COMBINED REPORTING CONSISTENCY. Income must be reported in a manner consistent with federal combined reporting principles for purposes of this chapter.

NEW SECTION. Sec. 713.  HIGH-INCOME DISCLOSURE. Taxpayers exceeding $1,000,000 in Washington taxable income must disclose material transactions that result in significant reduction of taxable income under this chapter as defined by rule of the department."

Renumber the remaining sections consecutively and correct any internal references accordingly.

--- END ---