TurboTax handles capital gains taxes for both federal and state returns. In 2021, the State of Washington enacted a new 7% tax on long-term capital gains realized by Washington residents and by nonresidents with respect to certain transactions occurring within the state.
Update:
The Washington State Supreme Court has ruled that the excise tax on capital gains is constitutional and valid. As such, the Department of Revenue will continue collecting the tax which is due on April 18, 2023.
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[Edited 03/28/23 | 1:42 PM PST]
On March 24, 2023 the WA court filing shows the tax has been upheld as an excise tax.
https://www.courts.wa.gov/opinions/pdf/1007698.pdf
Even when it was in the state of unconstitutional, there was a stay on the ruling and the State had the right to keep collecting. Make sure to read the resources, because it is applied per transaction, not as a net LTCG.
https://dor.wa.gov/taxes-rates/other-taxes/capital-gains-tax
https://dor.wa.gov/taxes-rates/other-taxes/capital-gains-tax/do-you-owe-capital-gains-tax
"Amount
If you answered Yes to the above question, you may owe Washington state capital gains tax."
"How are exemptions to the capital gains tax applied?
Exemptions from Washington’s capital gains are based on transactions. This means you may owe capital gains tax on some transactions and not on others."
"Deductions and exemptions
There are several deductions and exemptions available that may reduce the taxable amount of long-term gains, including an annual standard deduction of $250,000 per individual. In the case of spouses or domestic partners, the combined standard deduction is limited to $250,000 whether they file joint or separate returns."
here is a better link Washington Supreme Court upholds capital gains tax | Courthouse News Service
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Washington has a 7.0% long-term capital gains tax which applies to the sale of stocks, bonds, business interest, and other investments. However, the capital gains tax does not apply to other assets such as real estate, retirement accounts, certain livestock, commercial fishing privileges, and more. Starting in Tax Year 2022, you may need to file a capital gains tax return if you sold long-term assets shown above, and the gains exceed the $250,000 threshold.
There are several deductions and exemptions available that may reduce the taxable amount of long-term gains, including an annual standard deduction of $250,000 per individual. In the case of spouses or domestic partners, the combined standard deduction is limited to $250,000 whether they file joint or separate returns.
The tax takes effect on Jan. 1, 2022, and the first payments are due on or before April 18, 2023.
TurboTax does not file WA tax forms.
WA State Capital Gains Tax Guide