The Washington Legislature recently passed a new capital gains tax. Starting Jan. 1, 2022, Washington residents will owe a 7 percent flat tax on their federal capital gains if their profits exceed $250,000 annually.

Between a lengthy list of exemptions and questions about whether this could pave the way for a state income tax, it can be hard to know how this tax may impact you.

UW Law Professor Scott Schumacher discusses the important elements of the new tax and its implications for average Washington residents.