Bill > SB5774

This bill clarifies the scope of Washington state's business and occupation (B&O) tax deduction for investment income, responding to recent legal uncertainty created by a state Supreme Court decision (Antio, LLC v. Department of Revenue). The bill amends existing tax law to provide a broader and more comprehensive definition of "investment," explicitly including various financial instruments such as equities, fixed income instruments, derivative instruments, and commodities. It adds a new definition for "factoring" and modifies existing definitions related to banking, lending, and security businesses. The bill expands what can be considered investment income for tax deduction purposes, ensuring that more types of financial activities and income can potentially qualify for the tax deduction. Importantly, the bill applies retroactively but does not allow taxpayers to seek refunds for taxes already paid on investment income before the law's effective date. The legislature's intent is to provide greater clarity and stability for taxpayers while maintaining fairness in tax treatment across different types of financial businesses and investment activities.

Budget and Finance

https://app.leg.wa.gov/billsummary?BillNumber=5774&Year=2025&Initiative=false