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WA SB6229
Bill
Status
1/20/2026
Primary Sponsor
Noel Frame
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AI Summary
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Amends Washington's capital gains tax (RCW 82.87.020) to include gains from Internal Revenue Code Section 1202 qualified small business stock in the state's taxable "adjusted capital gain"
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Section 1202 stock gains, which receive partial or full exclusion from federal income tax, would be added back when calculating Washington capital gains tax liability
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Effectively closes a loophole where investors could avoid Washington's capital gains tax on small business stock gains that are excluded at the federal level
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Applies to capital gains earned on or after January 1, 2026
Legislative Description
Concerning taxation of a long-term capital gain of a section 1202 small business stock.
Last Action
Executive session scheduled, but no action was taken in the Senate Committee on Ways & Means at 4:00 PM.
2/19/2026