Following a 24-hour debate, the Washington State House passed Senate Bill 6346, a tax on people earning more than $1 million per year, by a vote of 51-46. The tax would apply beginning in 2028, with the first payments due in 2029.

If the Washington State Senate concurs with the House version and Gov. Bob Ferguson signs the bill into law, this bill will provide significant funding to Washington residents in the form of enhanced education and family tax credits. However, the fallout has already started, with Starbucks founder Howard Schultz announcing that he plans to move to Florida, a move that coincidentally came shortly after the bill advanced in the Legislature. The question now arises of whether more will follow and if Washington is equipped to financially handle a mass exodus of high earners out of its state.

An Overview Of Washington’s Tax On Millionaires

The state of Washington has been one of nine states that do not levy a broad-based personal income tax, joining Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas and Wyoming. This notion has long been a magnet for individuals seeking to retain more of their earnings within the United States.

However, the state of Washington is on the verge of changing this. Washington is just a few steps away from imposing a tax on individuals earning more than $1 million annually. Washington Senate Bill 6346 will levy a 9.9% tax on income above $1 million based on federal adjusted gross income with certain state adjustments. All income under $1 million will not be subject to this new tax rate.

For instance, if an individual earns exactly $1 million in adjusted gross income, that taxpayer will owe no additional taxes as a........

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