PREPROPOSAL STATEMENT OF INQUIRY
DEPARTMENT OF REVENUE
[Filed September 4, 2019, 8:28 a.m.]
Subject of Possible Rule Making: SB [ESSB] 5998, 2019 legislative session, chapter 424, Laws of Washington. Pursuant to section 5 of SB 5998, the department of revenue is developing guidance to implement new real estate excise tax (REET) provisions authorizing the department to disregard the form of a real estate transaction structured in a way that serves no meaningful purpose other than to avoid or reduce tax.
Statutes Authorizing the Agency to Adopt Rules on this Subject: SB [ESSB] 5998, 2019 legislative session, chapter 424, Laws of Washington. RCW 82.01.060
, and 82.45.150
Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: The legislature has encouraged the department of revenue to provide guidance in this new area of REET law. Rules on this subject would assist taxpayers in avoiding situations where the form of a transaction is disregarded, while also assisting county and state officials in collecting the correct amount of REET.
Process for Developing New Rule: The department of revenue will host a public meeting in late 2019 to gather public input on the tax avoidance REET issues. Thereafter, the department will draft a new rule in chapter 458-61A WAC addressing this issue. That draft rule will go through the standard rule-making process described in the Administrative Procedures [Procedure] Act in chapter 34.05
RCW, including a CR-102 public hearing for additional public input.
Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication by contacting Rex Munger, P.O. Box 47453, Olympia, WA 98504-7453, phone 360-534-1554, fax 360-534-1606, TTY 800-833-6384, email RexM@dor.wa.gov, web site dor.wa.gov.
Additional comments: Written comments may be submitted by mail or email and should be directed to Rex Munger using one
of the contact methods above.
Written and oral comments will be accepted at the public meeting on October 16, 2019, at 10:00 a.m., at Conference Room 252, 6400 Linderson Way S.W., Tumwater, WA 98501.
September 4, 2019