A surviving spouse in Washington almost never owes state estate tax on what they inherit from their husband, wife, or state registered domestic partner. The unlimited marital deduction lets any amount of property pass to the survivor free of Washington estate tax at the first death. The catch is that Washington estate tax for a surviving spouse is really a question about two deaths, not one: the state defers the tax rather than forgiving it, and it does not let the survivor inherit the first spouse’s unused exemption. Families who assume federal rules carry over at the state level often learn this the expensive way when the second estate is settled.
How the Marital Deduction Works
Washington’s estate tax code allows an unlimited deduction for assets transferred to a surviving spouse. The deduction applies to outright bequests, property passing under a will, and assets held in qualifying trusts. State registered domestic partners get the same treatment as married spouses.1Washington State Legislature. RCW 83.100.047 Marital Deduction, Qualified Domestic Trust – Election – State Registered Domestic Partner Entitled to Deduction
What the deduction does not do is erase the tax. It postpones it. Whatever the survivor still owns at death gets measured against the exclusion amount in effect in that later year, and anything above the threshold is taxed then. During the survivor’s lifetime, the house, the investments, and the rest of the shared assets stay intact.
To claim the deduction, the estate tax return has to correctly identify every asset passing to the surviving spouse. Errors in the marital deduction schedules are among the most common reasons the Department of Revenue asks for additional information or adjusts a return.
Washington Does Not Allow Portability
Under federal law, any portion of the first spouse’s estate tax exemption that goes unused can be transferred to the survivor. Washington has no equivalent rule. Each estate gets only the exclusion amount in effect on that person’s own date of death.2Washington Department of Revenue. Estate Tax FAQ
This is where surviving spouses get caught out. Picture a couple with a combined estate of $5 million. If the first spouse leaves everything to the survivor using the marital deduction, that first exclusion is simply gone. When the survivor later dies, only one exclusion shelters the whole $5 million, and the overage is taxed at Washington’s graduated rates.
The standard fix is a bypass trust, sometimes called a credit shelter trust. The first spouse’s estate funds a trust up to the exclusion amount, which passes free of Washington tax by using the first exemption rather than the marital deduction. The rest goes to the surviving spouse under the marital deduction. The survivor benefits from the trust during their lifetime, and when they die, the trust assets are not counted in their taxable estate. Skipping this step is probably the single most expensive state-level planning mistake Washington couples make.
QTIP Trusts and the State-Only Election
A Qualified Terminable Interest Property trust lets the first spouse’s estate claim the marital deduction while controlling where the assets ultimately end up. The trust must pay all its income to the surviving spouse for life, and no one else can receive distributions while the survivor is alive. This structure is common in blended families where one spouse wants to provide for the survivor but keep the remaining assets on a path to children from a prior relationship.
Washington permits a separate state QTIP election that can differ from the federal election. A personal representative may elect a larger or smaller QTIP amount on the Washington return than on the federal return.3Washington State Register. WAC 458-57-115 Valuation of Property, Property Subject to Estate Tax, and How to Calculate the Tax That flexibility matters because Washington’s exclusion is much lower than the federal one. A well-advised estate can use the full federal unified credit and still reduce the Washington bill by electing a different QTIP percentage on the state return.
When the surviving spouse later dies, only property for which a Washington QTIP election was actually made is included in the survivor’s Washington taxable estate. Property elected only at the federal level is not added back for state purposes.1Washington State Legislature. RCW 83.100.047 Marital Deduction, Qualified Domestic Trust – Election – State Registered Domestic Partner Entitled to Deduction A mistaken election can cost a family hundreds of thousands of dollars at the second death.
Non-Citizen Surviving Spouses Need a QDOT
The unlimited marital deduction is only available for outright bequests and QTIP trusts when the surviving spouse is a United States citizen. If the surviving spouse is not a citizen, the estate must use a Qualified Domestic Trust (QDOT) to defer the tax.2Washington Department of Revenue. Estate Tax FAQ
A QDOT must have at least one trustee who is a U.S. citizen or a domestic corporation, and the trust document must give that trustee the right to withhold estate tax from any distribution of principal.4Office of the Law Revision Counsel. 26 USC 2056A Qualified Domestic Trust Income distributions to the surviving spouse are generally not taxed, but any principal distribution triggers estate tax as if the amount were still part of the original decedent’s estate. Whatever remains in the QDOT at the survivor’s death is taxed the same way.
The QDOT election must be made on the estate tax return no later than one year after the return’s due date, including extensions. Missing that deadline wipes out the marital deduction entirely, and the full value of the non-citizen spouse’s inheritance becomes taxable at the first death. For mixed-citizenship couples, this is the most time-sensitive planning issue on the list.
Community Property and the Return
Washington is a community property state, and that shapes how the estate tax return looks. When a married person dies, the entire community estate is reported on the return, but only the decedent’s half is actually subject to tax. The return shows the full value of each community asset, then subtracts one-half as the surviving spouse’s ownership share.2Washington Department of Revenue. Estate Tax FAQ The decedent’s separate property is reported in full.
Getting this split right matters. Overstating the decedent’s share inflates the taxable estate; understating it can trigger a Department of Revenue inquiry. Couples who have mixed separate and community assets together over the years often need help sorting out what belongs in each column.
What the Survivor’s Estate Will Face Later
At the second death, the surviving spouse’s estate is measured against whatever exclusion Washington has in place that year. For deaths occurring in 2026, the applicable exclusion amount is $3,076,000.5Washington Department of Revenue. Estate Tax Tables If the taxable estate falls below that figure, no tax is owed.
This threshold moved substantially in mid-2025. Washington held its exclusion at a flat $2,193,000 for years. On July 1, 2025, the legislature raised it to $3,000,000 and added an annual inflation adjustment tied to the Seattle metropolitan area consumer price index. The 2026 figure is the first inflation-adjusted number.6Washington Department of Revenue. Estate Tax The Department of Revenue used the August 2025 Seattle CPI because a federal government shutdown kept the Bureau of Labor Statistics from publishing the October figure on schedule, and it may recalculate if that number is released within the year. Going forward, the exclusion is recalculated each January from the most recent October CPI, rounded to the nearest $1,000, with no downward adjustment allowed.7Washington State Legislature. Washington Revised Code Chapter 83.100 Estate and Transfer Tax Act
Everything above the exclusion is taxed at graduated rates that climb steeply. For deaths on or after July 1, 2025, the brackets apply to the taxable amount after the exclusion is subtracted:8Washington State Legislature. RCW 83.100.040 Estate Tax Imposed – Amount of Tax
- Up to $1,000,000: 10%
- $1,000,000 to $2,000,000: $100,000 plus 15% of the amount over $1,000,000
- $2,000,000 to $3,000,000: $250,000 plus 17% of the amount over $2,000,000
- $3,000,000 to $4,000,000: $420,000 plus 19% of the amount over $3,000,000
- $4,000,000 to $6,000,000: $610,000 plus 23% of the amount over $4,000,000
- $6,000,000 to $7,000,000: $1,070,000 plus 26% of the amount over $6,000,000
- $7,000,000 to $9,000,000: $1,330,000 plus 30% of the amount over $7,000,000
- Over $9,000,000: $1,930,000 plus 35% of the amount over $9,000,000
These rates jumped in mid-2025. The old top rate was 20%; the current top rate is 35%. A $6,076,000 estate in 2026 produces a Washington taxable amount of $3,000,000 after the exclusion, which lands in the 17% bracket and generates a $420,000 tax bill.
Filing the Return at the First Death
Even when the marital deduction wipes out the tax, a return is usually still required so the deduction can be formally claimed and the Department of Revenue can issue a closing letter. The Washington estate tax return is due within nine months of the date of death, with a six-month extension available on request.9Washington State Legislature. WAC 458-57-135
Returns can be filed electronically through the Department of Revenue’s My DOR portal (which requires a SecureAccess Washington account) or mailed on paper.10Washington Department of Revenue. Estate Tax Filing Options and Forms A completed federal Form 706 must be submitted as a supporting document even if no federal return is otherwise required, along with a certified death certificate. All assets are valued as of the date of death, with professional appraisals for real estate and account statements for financial holdings.
The closing letter the department issues after review confirms that the estate’s tax liability has been satisfied and clears any state claim against the property. For a surviving spouse who inherited everything under the marital deduction, that letter is often the last piece of state paperwork before the estate can be fully wound up.