Washington's 9.9% income tax. Should you move to Idaho in 2026?

Washington just passed an income tax. 9.9% on every dollar of household income over a million. And the phone has not stopped ringing. Here is what nobody in my industry wants to say: I benefit from every one of those calls. But I will actively talk you out of this move if the numbers do not work. And for a lot of people calling me right now, the numbers do not work, because they are chasing what I call the equity mirage.

This is the maintained companion article to Rachael's May 19, 2026 video. Where the video and the article differ on a number, the article wins. Several figures were corrected silently against current sources — Washington's real estate excise tax tiers, Idaho's 2024 growth rank, gas prices, and Ada County household income are all updated to the most recent verified data. Every claim is cited at the bottom.

What SB 6346 actually says

Be very clear about what just happened. Senate Bill 6346, sponsored by Sen. Jamie Pedersen of Seattle, passed the Washington House 51–46 after a marathon debate and the Senate 27–21. Governor Bob Ferguson signed it on March 30, 2026. It is now law.

• Rate. 9.9% on household income above $1 million per year.
• Effective. January 1, 2028 — first returns and first payments due in 2029.
• Revenue. Roughly $3 billion annually, applied to an estimated 21,000 filers, with a meaningful share earmarked for working-family tax credits.
• Legal challenge. Filed within days by former Attorney General Rob McKenna and the Citizen Action Defense Fund, citing Washington's constitutional uniformity clause on income — the same clause that has knocked down prior income tax attempts. (Lawsuit summary.)
• Ballot. A repeal initiative is being organized for the November 2026 ballot.

So the tax is real, the lawsuit is real, the ballot fight is real, and the first dollar of tax does not collect for another two years. That sounds like time. It is not. Two things are already happening on the ground.

First, listings in Washington are climbing. Coverage of the immediate aftermath shows a spike in high-end listings on the west side, and at least one analysis estimated a sharp uptick in homes coming on the market in the weeks after signing. People who got watching what happened with the 2021 Washington capital gains tax — sold first as a tax on the wealthy, now collecting routinely — are not waiting to see how this one plays out.

Second, the calls to my office have not stopped. Some of the people calling have the income profile this tax was written for. Most of them do not — but they are reading the headline and assuming Idaho is the obvious answer. For some of them it is. For most, it is more complicated than the YouTube version makes it sound.

Idaho's tax stack. What actually works in your favor.

Let me lay it out clean.

1. A 5.3% flat income tax

Idaho's HB 40 (2025) retroactively cut the state income tax from 5.695% to 5.3% flat on all earned income above the standard deduction. Same rate at $100K and at $5M. Predictable. The flat rate is the single biggest reason Idaho ranks well on tax competitiveness studies — Tax Foundation places Idaho 11th overall on its 2026 state tax climate index.

2. No real estate transfer tax

When you sell a home in Washington, the state takes a tiered Real Estate Excise Tax (REET) ranging from 1.1% to 3% of the sale price, with local REET layered on top of up to 0.5%. For a $1 million sale in Washington, the state portion runs roughly $11,855 (1.1% on the first $525K + 1.28% on the next $475K), and total state-plus-local typically sits around $16K–$17K. On a $3 million sale, you hit the 3% top marginal rate and the bill climbs sharply. (Note: in the source video the figure was cited as "up to $30K on a $1M home" — that overshoots the tiered structure; the verified number for a clean $1M sale is closer to $17K total.) Idaho's state REET is zero.

3. No state estate tax

Washington's state estate tax kicks in at a $2.193 million exemption with rates from 10% to 20%. Idaho has no state estate tax. For older buyers with significant equity, this is a real number — not a hypothetical.

4. Effective property tax around 0.50%

Idaho's effective property tax rate sits around 0.50% statewide per Tax Foundation 2026 data, with county-level variation from roughly 0.31% in Clark County up to 0.75% in Nez Perce County. That is roughly half the U.S. national effective rate. Idaho's homeowner's exemption compounds the savings: 50% of your primary home's assessed value, capped at $125,000, comes off your taxable base — but you must apply through your county assessor before the deadline. It is not automatic.

5. Social Security and retirement income

Idaho does not tax Social Security benefits at all. None. Plus, for filers age 65 and older, there is an Idaho retirement benefits deduction worth up to $47,935 for single filers / $95,870 for married filing jointly on qualifying pension, 401(k), 403(b), and annuity income from qualified plans. Combine that with the homestead exemption and Idaho's circuit-breaker program (a property tax reduction of up to about $1,500 for eligible owners 65+ under income limits) and total tax exposure for many older homeowners drops materially below what they paid in Washington. (Idaho State Tax Commission.)

The combined effect is straightforward: a Washington buyer who sells their primary residence and buys an Idaho primary residence saves five figures at the closing table on REET alone, then sees an ongoing reduction in effective property tax that more than offsets the new state income tax obligation — unless their household income happens to be above $1M, in which case both states now tax it.

The grocery tax most Idaho boosters skip

This is the part the cheerleader videos leave out. Idaho applies its full 6% state sales tax to groceries. One of about a dozen states that still do. There is a grocery tax credit, raised from $120 to $155 per person in 2025 via HB 231. For a family of four that is $620 a year back via your Idaho tax return.

Run the math at the checkout line. A $212 cart in Idaho adds about $12.72 in sales tax. Do that weekly and you are looking at $660+ a year in grocery tax that you were not paying in Washington. The credit covers most of it for a family of four; heavier grocery spenders pay more in sales tax than the credit returns.

Not a dealbreaker. Just a budget line that needs to appear on your worksheet — alongside the gas savings, the registration savings, and the property tax savings.

The equity mirage. Why $800,000 is not what it used to be.

Here is the call I take three times a week.

"Rachael, we are selling our house in Snohomish County for $800,000. We want to buy in Boise and pocket the difference."

And I say: what difference?

In 2020, you could sell an $800K home in Western Washington and buy a brand-new build in Meridian for around $350K. That is $450K of breathing room. That world does not exist anymore.

The April 2026 numbers (Boise Regional Realtors / Intermountain MLS):

• Ada County median sale price: $545,000
• Meridian median: roughly $520,000–$560,000 depending on submarket
• Eagle median: hit $1,000,000 in November 2025 and remains in the $770K–$960K range
• Canyon County (Nampa, Caldwell) median: roughly $429,945

So a Washington buyer selling for $800K and buying at Ada County's median pulls $255K out of the move on the face of it. After REET savings in Idaho (zero), Washington-side selling costs, moving costs, closing costs in Idaho, and the year-two property tax reassessment that catches almost every relocator, the realistic cash cushion is closer to $120K–$150K. Not nothing. But not a fortune. And not what 2020-era assumptions suggest.

The buyers who get this wrong are usually the ones who heard about the move from a friend who relocated in 2020, ran the math in their head on 2020 prices, and never updated for current Treasure Valley data. Update the math against this week's MLS before you sign the listing agreement in Washington.

The wage wall. This changes the equation for half the calls.

This is the part that flips the decision for a lot of families.

Idaho's minimum wage is $7.25 an hour. The federal floor. Idaho has not raised it. Washington's 2026 minimum is $17.13 an hour — the highest state minimum in the country. That is a 2.4x difference at the bottom of the wage scale, and it scales upward in trades and service work. Nurses, teachers, tradespeople — Idaho wages run materially below Western Washington wages across the board.

Median household incomes tell the same story:

• Ada County: $91,502 (ACS 2024 1-year — note: Rachael cited "roughly $78K" in the video; that was the older estimate, and the 2024 number is meaningfully higher)
• King County, WA: roughly $110,000+

So here is the math that decides it:

• If you have a remote job that pays Western Washington wages. The move works beautifully. Your salary stays, your housing costs drop, your effective property tax falls, your gas and registration savings show up monthly, and you keep the bigger paycheck. This is the cleanest scenario.
• If you have a remote job and your employer reprices to Idaho local market. Some employers do this on a delayed schedule; some do not. Check your offer letter and your company's geographic pay policy before you list in Washington.
• If you are planning to find a job in Idaho after you land. You must know the comparable Idaho salary for your role before you sell. Not what you make now. What the same job pays here. For nurses, teachers, and skilled trades, the delta is often 15–25%, and the housing math has to absorb that hit too.

Every relocating client I work with answers one question before we look at a single house: what is your household income going to be in Idaho? Not what it is now. What it will be here. Then we build the budget from that number.

The daily costs that do not show up on the tax-comparison chart

Gas

Washington gas in May 2026 averages $5.77 a gallon per AAA, second-highest in the country after California. Idaho averages roughly $4.63. That is about $1.14 a gallon back in your pocket. For a household running a truck and an SUV across 1,500 miles a month, that is roughly $80–$130 a month back. (Note: the source video used $5.40 and $3.80–$4.10 — both figures were a few weeks stale at publication; AAA mid-May 2026 numbers are the verified version.)

Vehicle registration

Washington vehicle registration in King, Pierce, or Snohomish counties layers basic state tabs (weight-based) with Sound Transit RTA excise tax, which can push annual registration on a late-model SUV into the $600–$800 range. Idaho registration is age-based and county-supplemented, typically running under $100 for a passenger vehicle. The savings are immediate and recurring.

Auto insurance

Multiple clients tell me their auto insurance dropped by a third to a half just by changing their garaging address from Washington to Idaho — same carrier, same coverage, different state. Get a real quote from your current carrier before you finalize the budget. Cap that win at "I'll see what they offer," not "I expect to save $X."

Heating in winter

Idaho's electric rates run lower than coastal Washington — Idaho Power's grid is heavily hydroelectric and the residential rate per kWh is materially below Puget Sound averages. But, Idaho winters are colder than Western Washington's. A 3,000-square-foot home in Meridian heated by natural gas from November through March can run $250–$400 a month on the gas bill, depending on the winter and your envelope insulation. If your Washington home was electric-resistance heat at PSE rates, you might break even or come out ahead in Idaho. If your Washington home was a well-sealed newer build with natural gas at low rates, you might pay slightly more in Idaho winters than you expect. Ask any seller you make an offer on for their last 12 months of utility bills — actual numbers, not estimates.

The four landing zones

Idaho is not one market. It is a dozen markets stitched together. These are budget bands, not demographic recommendations. Match the band to your actual situation.

Five traps the cheerleader videos do not mention

Case study: how a careful $60,000 catch can change a buyer's life

Identifying details are anonymized; the underlying transaction and numbers are real, used with the family's consent.

A family from a Tacoma-area zip code called me in February 2026. He works remote. She is a nurse looking to transfer her license. They had already talked to two other Idaho agents, both of whom had basically said "come on down, the market is great." No tax analysis. No wage comparison. No conversation about what their Washington equity actually buys in 2026 versus what it bought in 2020. Just "come on down."

By the time they called me, they were about to make an offer on a Meridian property that was about $60,000 over what the immediate neighborhood and comparable closings supported. I pulled the comparables. I showed them the levy rate on that specific subdivision. I showed them that three streets over there was a newer build with better mechanical systems for $40,000 less. They are closing on the second house next month.

That outcome was not a magic trick. It was running the numbers carefully. The family told me they almost made the most expensive mistake of their lives because two prior agents were happy to write the contract.

I would rather lose a commission today than help any family make a decision they regret for the next ten years.

For locals: yes, this is going to shake the market

If you already live in the Treasure Valley, this section is for you. Washington passing a major tax bill that pushes high-earning families across the border, into a state with a 5.3% flat tax, an effective 0.50% property tax, and no transfer tax, is going to keep buyer demand elevated. The Boise metro was already adding population faster than housing inventory could absorb. Ada County ended early 2026 around two months of supply — a healthy market is 4–6 months. We are well short.

What that means for you depends on which side of the transaction you sit on.

• If you own a Treasure Valley home and have been thinking about moving up, moving sideways, or cashing out and heading to the mountains, your current equity position is real and the demand behind it is real. For homeowners who bought before 2020, this is one of the strongest seller positions you have been in since 2022.
• If you are a local first-time buyer, the dynamic is harder. You are bidding against people selling million-dollar homes on the west side who can pay cash for a $550K Meridian house. Your lender needs to be aggressive on rate buydowns and seller credits — the math on which is in our rate buydown strategy article. Lean on local-only buyer incentive programs where they fit your situation.
• If you are a small-business owner in the valley, the demographic shift is a real revenue tailwind. Higher household incomes moving into the metro lifts consumer spending, drives new restaurant and service openings, and reinforces the trajectory that has been visible for five years.

The people moving here are not the problem. The problem is that the Treasure Valley does not have enough houses. That is supply and demand, not tribalism. The locals who hate it the most are the ones who feel like they did not get a vote. I get that. I grew up here. I sit in the same Eagle Road traffic. The honest answer is that the market is doing what the market does. You can either be on the right side of the equity trade or watch other people make it.

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How to execute

If you are a Washington seller considering this move, here is the order I run it in with every client:

1. Run a 2026 tax stack comparison. Not 2020. Not the YouTube numbers. The actual current numbers on your actual household income, household size, and asset base. Loop in a Washington-licensed CPA if you are at all close to the SB 6346 threshold or have meaningful capital gains exposure.
2. Confirm your Idaho income. Remote job that travels with you? Great. Local job? Get the comparable Idaho salary in writing before you list the Washington house.
3. Update the equity math against current Treasure Valley medians. Use the April 2026 IMLS numbers in this article, not your friend's 2020 story.
4. Pick the right zone. Match Zone 1–4 to your actual budget, your actual commute, and your tolerance for inversion and smoke. Tour at least once in person.
5. Time the transition year carefully. Closing dates, residency changes, and asset sales all interact with both Washington and Idaho tax timelines. This is where most of the planning leverage lives.
6. Stand on the property at 5:30 PM on a Tuesday before you sign. The commute is real. The traffic is real. The smoke is real. The inversion is real. Be there in person at the time of day you would actually be commuting before you commit.

And before you book the moving truck: grab the 2026 Treasure Valley Relocation Audit. It is free, no email wall, and walks through 11 sections of what nobody tells you before you move here — the kind of stuff that does not fit in a YouTube video.

Good News Realty Group is committed to the principles of the Fair Housing Act. We do not discriminate based on race, color, religion, national origin, sex, familial status, disability, or any other protected class. All buyers are free to consider any neighborhood, price point, or property in Idaho. The "landing zones" in this article are budget-based and lifestyle-based, never demographic. Equal Housing Opportunity.

This article discusses tax topics for educational purposes only. It is not tax, legal, or financial advice. Joshua Connell of Good News Realty Group is also a licensed loan officer (NMLS #2506422) at Paradigm Mortgage; clients are free to use the lender of their choice. For personalized tax planning related to a Washington–Idaho transition, consult a CPA licensed in both states. Buyer-agent compensation is fully negotiable and not set by Good News Realty Group, NAR, or the MLS — we walk you through how it works on every home before you tour.