Often called a “millionaires’ tax,” SB 6346 would apply a 9.9 percent income tax to individuals and households with Washington taxable income over $1 million. That includes many small business owners and homebuilders who operate as LLCs, S corporations, partnerships, and sole proprietorships.

This proposal would have serious consequences for housing affordability and long-term investment in Washington.

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If passed, SB 6346 would increase costs, reduce investment, and make it harder to build the homes Washington families need.

Your State Representatives need to hear from you.

Why This Bill Matters

Impacts Small Businesses and Builders

Many homebuilders are small businesses whose income flows through to their personal tax returns. SB 6346 would tax that business income directly, hitting local employers rather than large corporations.

Ignores the Reality of Construction

Homebuilding is cyclical and long term. A single strong year, a refinancing event, or a one-time distribution can push a builder over the $1 million threshold, even after years of losses or major upfront investment.

Limited Ability to Use Prior Losses

Projects often take years to permit and build before they generate revenue. While SB 6346 technically allows losses from prior years to be carried forward, it limits those deductions to just 80% of income in a given year, introducing complexity from builders who can still face a substantial tax bill the moment a project finally becomes profitable—even after years of losses and upfront investment.

Higher Costs Mean Fewer Homes

By increasing financial risk and reducing capital available for new projects, this bill will raise housing costs and slow housing production across Washington.