Your net proceeds will appear here
Enter your numbers and watch the sale price get carved down, layer by layer, to what you keep.
The full breakdown
Working with a CPA or attorney?
Send them this calculator. Your numbers aren't included; they'll enter their own. Or download your breakdown as a PDF to bring to the conversation.
Where the sale price goes
Each layer, as a share of the price.
How this estimate was calculated
Does the year of sale matter?
The same sale, estimated in 2026 or 2027 versus 2028 or later, when Washington's new income tax begins (if it takes effect).
The new tax allows a credit for Washington capital gains tax paid, which often offsets the tax on the gain itself. Its status depends on Initiative 645 (November 3, 2026 ballot) and a pending court challenge.
Asset sale or stock sale
This estimate treats the whole gain as long-term capital gain. In an asset sale, part may be ordinary income, and gains on real estate and depreciable equipment are exempt from Washington's capital gains tax.
Paying the tax
Washington capital gains tax is due with your federal return, typically April 15. Starting with tax year 2026, you may prepay up to six months early.
Spouses share deductions
Married couples and domestic partners share one Washington standard deduction, filing jointly or separately.
Planning ahead
Deal structure, timing, installment sales, and qualifying for the family deduction are best decided years before a sale, with your CPA and attorney.
Washington business sale taxes at a glance, 2026
Sources: Washington Department of Revenue; RCW 82.87; IRS Rev. Proc. 2025-32; ESSB 6346. Until Washington publishes its 2026 standard deduction, the 2025 figure is used.
Net proceeds on example Washington business sales
Married filing jointly, $250,000 of other income, 6% deal costs, a cost basis of 10% of the price, no debt, an owner who actively works in a pass-through business, and a sale in 2026.
| Sale price | Federal tax | Washington tax | Net proceeds | Kept | Net if family deduction applies |
|---|---|---|---|---|---|
| $2,000,000 | $316,205 | $109,798 | $1,453,997 | 73% | $1,563,795 |
| $5,000,000 | $820,205 | $359,278 | $3,520,517 | 70% | $3,879,795 |
| $10,000,000 | $1,660,205 | $775,078 | $6,964,717 | 70% | $7,739,795 |
| $20,000,000 | $3,340,205 | $1,606,678 | $13,853,117 | 69% | $15,459,795 |
Calculated from IRS Rev. Proc. 2025-32 and Washington Department of Revenue figures. At these figures, a sale in 2028 or later adds no Washington income tax, because the credit for capital gains tax offsets it.
How does this calculator work?
It follows the order a sale is actually taxed, using IRS and Washington Department of Revenue figures.
Starts with the price
Subtracts deal costs and your cost basis to find the gain, and debt payoff to find your cash.
Applies federal tax
Long-term capital gains rates of 0%, 15%, and 20% for 2026, stacked on your other income, plus the 3.8% net investment income tax where it applies.
Applies Washington's tax
7% above the $278,000 standard deduction and 9.9% on taxable gains above $1 million, or $0 if the family-owned small business deduction applies.
Checks 2028 and later
Adds the new 9.9% income tax above $1 million, after the credit for Washington capital gains tax paid.
Verify it yourself
Every figure comes from the IRS, the Washington Department of Revenue, Washington law, and the Legislature's analysis of ESSB 6346.
Questions business owners ask
How much tax do you pay when you sell a business in Washington?
It depends on your gain, your other income, and how the sale is structured. A Washington owner can face federal capital gains tax of up to 20%, the 3.8% net investment income tax in some cases, and Washington's capital gains tax of 7%, or 9.9% on taxable gains above $1 million. This calculator estimates each layer.
Does Washington tax the sale of a business?
Washington's capital gains tax applies to long-term gains on business interests, after a standard deduction of $278,000 for 2025. Real estate is exempt, as are business assets that are depreciable or expensed for federal tax purposes, such as equipment.
What is Washington's family-owned small business deduction?
It lets a seller deduct the long-term gain from selling all or substantially all (at least 90%) of a qualified family-owned small business, which can bring Washington's capital gains tax on the sale to zero. The business must meet ownership, participation, and revenue tests, including worldwide gross revenue of no more than $11,095,000 for 2025 in the 12 months before the sale.
Do married couples get two Washington standard deductions?
No. Spouses and domestic partners share one combined standard deduction, whether they file jointly or separately.
Does the 3.8% net investment income tax apply when I sell my business?
Often not, if you actively work in the business and it is an S corporation, LLC, or partnership, because gains from an active trade or business are generally excluded. Gains on C corporation stock and passive interests are generally subject to it above the income thresholds.
Will the 2028 millionaires' tax make selling more expensive?
Not necessarily. The new tax allows a credit for Washington capital gains tax paid, which can offset much or all of the new tax on a sale gain. Owners with large ordinary income in the same year can still owe more. The tax takes effect January 1, 2028, and its status depends on Initiative 645 and a pending court challenge.
When is Washington capital gains tax due?
Payment is due with your federal return, typically April 15. An extension to file does not extend the time to pay. Starting with tax year 2026, you may prepay up to six months before the due date.
Does it matter if it's an asset sale or a stock sale?
Yes. In an asset sale, part of the price may be taxed as ordinary income, and gains on real estate and depreciable equipment are exempt from Washington's capital gains tax. This calculator assumes the entire gain is long-term capital gain, so your CPA should model your actual deal structure.
Is real estate included in Washington's capital gains tax?
No. Real estate is exempt, including gains on a privately held entity to the extent they come from real estate the entity owns directly.
How can I keep more from a sale?
Common planning topics include deal structure, timing, installment sales, charitable strategies, and confirming eligibility for the family-owned small business deduction well before a sale. These are decisions to make with your CPA and attorney, ideally years in advance.
Does QSBS reduce Washington taxes on a sale?
Yes, under current law. Gain excluded from federal tax under Section 1202, the qualified small business stock exclusion for C corporation shares, is also outside Washington's capital gains tax, because that tax starts from federal net long-term capital gain; the Department of Revenue confirms this. The federal exclusion is generally up to the greater of $10 million or 10 times basis, or $15 million for stock issued after July 4, 2025. Bills to change Washington's treatment did not pass in 2026.
Answers summarize the official sources linked on this page and are not tax or legal advice.
More Washington tax calculators
For business owners in Kitsap County
If a Kitsap business sells, the taxes can take a meaningful share of the price, and the biggest savings usually come from decisions made years earlier: how the sale is structured, when it happens, and whether it qualifies for Washington's family-owned small business deduction.
Walters Wealth Management is a family-run practice in Poulsbo built for business owners. We help owners plan around these numbers well before they matter, alongside their CPA and attorney.
Important information about this calculator
This calculator is provided by Walters Wealth Management for general educational purposes only. It produces a simplified, hypothetical estimate based solely on the amounts you enter and on figures published by the Internal Revenue Service and the Washington State Department of Revenue, and on Washington law.
It assumes the entire gain is long-term capital gain on the sale of a business interest, uses 2026 federal brackets and the 2025 Washington standard deduction, models qualified small business stock (QSBS) only as a full exclusion that you enter, without the partial exclusions for stock held under five years, and does not model ordinary income or depreciation recapture, state taxes outside Washington, installment sales, alternative minimum tax, credits, deductions beyond those described, or exemptions such as those for real estate and depreciable assets. Eligibility for the family-owned small business deduction depends on requirements this calculator cannot verify. The Washington income tax that begins in 2028 is modeled as enacted in ESSB 6346; its status may change as a result of Initiative 645 and pending litigation.
Actual results may differ materially. This is not tax, legal, or investment advice. Please consult a qualified tax professional or attorney before making decisions.