Selling · By Ron Rougeaux · Published 2026-09-28 · Updated 2026-09-28
Capital Gains When Selling a Home in Washington: The Basics
Many sellers worry about taxes. The good news: many homeowners qualify for a large federal exclusion on the gain from selling a primary residence. This is general information, not tax advice, so confirm with your CPA.
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The primary residence exclusion
Under current federal rules, single filers can often exclude up to $250,000 of gain and married couples filing jointly up to $500,000 if they meet ownership and use tests, generally living in the home two of the last five years.
Second homes and rentals
Rental properties and second homes follow different rules, including depreciation recapture. Plan ahead before you list.
Washington-specific points
Washington has no state income tax on wages, but it has a graduated real estate excise tax on sales and a separate capital gains tax on certain assets. Ask your CPA how it applies to your situation.
Browse homes for sale in Olympia, WA or search all South Sound listings.
Frequently asked questions
Will I owe tax on selling my primary home?
Many sellers owe little or nothing thanks to the exclusion, but it depends on your facts.
Should I talk to a CPA before listing?
Yes, especially for rentals, inherited homes or large gains.
Does improving my home reduce gain?
Capital improvements can raise your cost basis. Keep records.
Ready to find your place in Olympia? Search homes or text Captain Ron at (360) 338-8355. You can also email captainronjr@gmail.com.
About the author: Captain Ron (Ron Rougeaux)
Owner and Managing Broker of PNW Homes Group in Olympia. He works with every buyer and seller personally. More about Ron
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