The bill proposes a real estate excise tax exemption for the sale of qualified affordable housing in Washington State, amending RCW 82.45.010 to introduce new definitions and conditions for property transfers related to low-income housing and housing for individuals with developmental disabilities. It replaces the term "self-help" housing with "ownership," emphasizing that the housing must be provided for ownership by low-income individuals and families. The bill specifies that sales of qualified space in affordable housing developments to nonprofit organizations or public corporations for community purposes will be exempt from the excise tax starting January 1, 2026.

Furthermore, the bill outlines conditions for maintaining tax-exempt status, including continued use of properties for low-income housing and compliance with specific timelines. It tasks the Washington State Housing Finance Commission with data collection on the fiscal impacts of these exemptions and compliance with federal low-income housing tax credit requirements. The legislation also includes a performance statement related to affordable housing development, defines "nonprofit organization" as an entity exempt under section 501(c)(3) of the Internal Revenue Code, and introduces the term "qualified space." Additionally, it mandates a review by the joint legislative audit and review committee to assess the tax preference's effectiveness, with an expiration date for certain provisions set for January 1, 2030.

Statutes affected:
Original Bill: 82.45.010
Substitute bill: 82.45.010