If you’re a Washington resident with a sizable estate, big changes are coming to the state estate tax on July 1, 2025. For the first time in over a decade, the exemption is increasing—but so are the tax rates. Here’s a breakdown of what’s changing and how to prepare.

The Good News: Higher Exemption Threshold

Starting July 1, 2025, the Washington state estate tax exemption will rise from $2.193 million to $3 million.

This is the first increase since around 2013, and it reflects inflation adjustments that have been overdue. In practical terms, this means estates valued below $3 million will not owe Washington state estate tax.

The Bad News: Higher Tax Rates Above the Exemption

While the exemption increase is welcome, Washington is also raising the estate tax rates for estates above $3 million.

Current Rates (through June 30, 2025):

• 10% on the first $1 million over the exemption
• 14% on the next $1 million
• +1% for each additional million until a flat 20% applies to everything above ~$9.2 million

New Rates (starting July 1, 2025):

• 10% on the first $1 million over the exemption
• 15% on the next $1 million
• 17% on the next tier
• 19% on the next
• 23%
• 26%
• 30%
• 35% on everything over $12 million

These steeper rates could significantly increase the tax burden for high-value estates.

Why Planning Matters More Than Ever

If your estate is likely to exceed $3 million, now is the time to plan. Washington law provides ways for married couples to capture both spouses’ exemptions, effectively doubling the amount that can pass estate-tax-free.

Without proper planning, your estate could pay substantially more in taxes than necessary.

Key Takeaways

• Exemption increases to $3 million on July 1, 2025.
• Tax rates above the exemption are going up—with a top rate of 35% over $12 million.
• Estate planning strategies can help reduce or eliminate your Washington state estate tax bill.

Next steps: Talk to an experienced estate planning attorney to review your situation and create a strategy before the changes take effect. A little planning now could save your heirs hundreds of thousands—or even millions—in taxes.