Antio Legislation Introduced
February 24, 2025
By Mike Nelson
The Antio, LLC vs. Dept. of Revenue Washington Supreme Court (Antio) case has caused significant uncertainty around the longstanding understanding and application of the investment deduction for B&O taxes.
Since November, the WSCPA team has been working with other organizations like the Association of Washington Business and representatives from CPA firms, tax attorneys, non-profits, businesses, and others all affected by the sudden change in the more than 20 years of tax law, to provide clarity around this issue.
As the legislature works to craft the state’s next two-year budget, the legislature is facing a significant budget deficit. Since the Antio decision is current law, any bill that decreases future tax collections compared to current law will require a fiscal note from the Department of Revenue. This means that in order for a bill to pass, the legislature would need to include any negative state collections DOR says would be the result in the state budget.
On Monday, February 17, HB 1998 was introduced by Representative Amy Walen and Ed Orcutt to address the Antio, LLC vs. Dept. of Revenue Washington Supreme Court decision from last October. This bill would provide the most clarity by removing the definition of investment from the Antio case and replacing it with a definition in statute based on a common understanding of investments. This bill would take effect and return state law to the understanding all organizations had for the last 20 years.
On Monday, February 24, HB 2023 was introduced by Representative April Berg and Ed Orcutt, which would establish a workgroup to study the issue during the summer and provide a recommendation to the legislature for consideration next year. This bill would also delay the assessment of any tax on investment income to July 1, 2026, while the workgroup and legislature consider options. The WSCPA was included as a member of the workgroup and we, along with representatives from other types of organizations, would meet monthly after the legislative session to build consensus on a solution to this issue.
DOR has told the legislature that both bills would have significant fiscal notes making it difficult for the legislature to adopt either bill as part of a budget in the current climate.
This makes the case for correcting this change in law more complicated, and we need your help. As you navigate the Antio case for your clients, please consider sending your legislators a note about the impact this is having on you and your clients. To send a comment to your legislators you can use the legislative website to support the full change in HB 1998 here or the establishment of a workgroup in HB 2023 here.
The WSCPA advocacy team is working with our legislative champions to move this bill quickly before the budget deadlines for bills in the coming weeks.
Mike Nelson is WSCPA Manager of Government Affairs. You can contact Mike via email.