CPA for Seattle, WA Clients: Remote Tax, Payroll and Accounting

We are a Naperville, Illinois CPA firm, and we serve Seattle-area clients remotely; we have no office in Washington. Washington does not tax wages, which surprises people who then meet a different set of taxes: a capital gains excise tax, a gross receipts tax on businesses, city business taxes in Seattle, and employee-paid long-term care premiums. This page walks through them.

Washington capital gains excise tax

The tax applies to individuals on long-term gains from stocks, bonds, business interests and certain other assets, and it uses an annual standard deduction that is adjusted for inflation: $270,000 for 2024 and $278,000 for 2025. The base rate is 7%. Beginning January 1, 2025, an additional 2.90% applies to the portion of Washington capital gains above $1 million. Payments are generally due April 15, and an extension to file requires a request through the Department of Revenue's online system. If you request an extension or make a payment, you must file a return even if no tax is due. Because the tax can apply to a founder's sale of company stock or an employee's sale of RSU shares, it fits into a bigger plan along with capital gains and stock option rules.

State and Seattle business taxes

Most Washington businesses owe business and occupation (B&O) tax, a gross receipts tax on the total value of products sold or income earned. You cannot deduct labor, materials or other costs, and the rate depends on the activity, with more than 50 classifications. A Small Business B&O credit and a Multiple Activities Tax Credit can reduce the tax. Some cities add their own B&O taxes.

Seattle changed its tax under Seattle Shield Proposition 2, effective January 1, 2026. The B&O tax liability threshold rose from $100,000 to $2 million, a new $2 million standard deduction applies to businesses at or above that level, and rates for all classifications increased to offset it. The business license fee calculation did not change. Even a business under $2 million of taxable revenue must still file a Seattle B&O return. Some quarterly filers were moved to annual filing for 2026. Seattle also has a payroll expense tax, but it applies only to employers with very large Seattle payrolls.

Payroll: WA Cares and paid leave

WA Cares, Washington's long-term care program, is paid by employees at 0.58% of gross wages, and unlike Paid Leave premiums it is not capped at the Social Security wage base. Employers collect it from paychecks and report it with Paid Leave on the same quarterly report, without paying a share unless they choose to. Some employees may be exempt, but the employee must apply and give the employer a copy of the approval letter. Washington's Paid Family and Medical Leave program is separate. Businesses with fewer than 50 employees do not have to pay the employer share of its premiums. See our guide to state paid family and medical leave.

The community

The Seattle-Tacoma-Bellevue metro area has about 157,000 residents who identify as Asian Indian alone or in combination (roughly 3.9%), and King County has about 121,600 (5.3%) according to the American Community Survey for 2020 to 2024. We help these families with the US-India tax treaty, India account reporting, and tax planning for people with equity compensation.

How we can help

We prepare federal returns for Washington residents and multi-state returns for those with other-state income, plan around the capital gains tax and run payroll for Seattle-area businesses. See our business tax preparation and Washington pages. For decisions about your own taxes, speak with a qualified professional.

Frequently asked questions

General information only, not tax, legal or accounting advice for your situation. Rules, limits and deadlines change; confirm the current rules with the official source or a qualified professional before you act. Reading this page does not create a professional relationship with CPA Tax Payroll and Accounting Corp.