Washington Estate Tax in 2026: What Married Couples in Queen Anne Should Know
Washington’s estate tax applies at much lower thresholds than the federal system, which makes planning especially important for married couples in Seattle neighborhoods with higher property values.
- The Washington estate-tax exclusion amount is $3,076,000 per person for deaths occurring between January 1 and June 30, 2026
- For deaths occurring on or after July 1, 2026, the exclusion amount is set to $3,000,000
- For deaths occurring in the first half of 2026, Washington’s estate-tax rates may reach 35% for larger taxable estates; on and after July 1, 2026, the revised rates range from 10% to 20%
Just as important:
- Each spouse has a separate Washington exemption
- Washington does not recognize portability of an unused spouse exemption
This creates a planning issue for many married couples. If everything passes outright to the surviving spouse, the first spouse’s Washington exemption may go unused.
Why This Matters for Queen Anne Homeowners
In neighborhoods like Queen Anne, it is increasingly common for a married couple’s total assets to approach or exceed Washington’s estate-tax threshold without the family thinking of themselves as having a “taxable estate.”
A typical estate may include:
- A primary residence
- Retirement accounts
- Investment assets
- Life insurance
Combined, these assets can easily exceed $3 million. Without planning, the surviving spouse may later hold the entire estate in one name, which can increase Washington estate-tax exposure at the second death.
The Role of a Trust
A properly designed trust can help preserve each spouse’s Washington estate-tax exemption while still providing meaningful support and flexibility for the surviving spouse.
Instead of having everything pass outright to the surviving spouse, a portion of the first spouse’s estate can pass into a trust at death. This is often described as a credit shelter trust or bypass trust structure.
Depending on the plan, that structure can:
- Preserve the first spouse’s exemption
- Provide ongoing financial support to the surviving spouse
- Help reduce the risk that the combined estate will be taxed more heavily later
- Create a more deliberate framework for how assets pass to children or other beneficiaries
Example
A married couple in Queen Anne owns:
- A home worth approximately $1.8 million
- $1.2 million in retirement and investment accounts
Their combined estate is approximately $3 million, and that number may increase further when life insurance, business interests, or future appreciation are taken into account.
If everything passes outright to the surviving spouse, the first spouse’s Washington exemption may be lost. With a properly structured trust-based plan, both spouses’ exemptions may be better preserved.
Talk Through Your Situation
Every family’s situation is different. The right estate plan depends on your assets, your goals, your family structure, and the balance you want between simplicity and tax planning.
If you live in Queen Anne or the surrounding Seattle area, Queen Anne Law can help you review whether a trust-based plan makes sense for your family and whether your current documents reflect Washington’s estate-tax rules.
