Bill > HB1115

This bill addresses the excise tax treatment of amounts received by title and escrow businesses for document recording fees. The legislature found that the Department of Revenue has been assessing title and escrow businesses for failing to collect sales, use, and business and occupation taxes on recording surcharges, without providing prior guidance to the industry. Following a court of appeals decision that classified the document recording surcharge as an excise tax, the bill aims to clarify that sales and use taxes should not be levied on these recording surcharges. Specifically, the bill modifies existing tax law to exclude amounts remitted to county filing offices for document recording from taxation, provided that these amounts are separately identified on settlement statements, HUD-1 forms, or closing disclosures. The exemption applies to businesses primarily engaged in escrow agent services. The bill will take effect on January 1, 2026, and is intended to provide relief to title and escrow businesses, many of which are small independent businesses that have faced significant back tax assessments.

Budget and Finance

https://app.leg.wa.gov/billsummary?BillNumber=1115&Year=2025&Initiative=false