Because of state and federal laws, a firearm purchased out-of-state by a Washington resident must be sent from the out-of-state seller to a federally licensed gun dealer located in Washington State.Once the Washington gun dealer has conducted the required background checks, the dealer may transfer the firearm to the Washington buyer. Instructions regarding the taxability of these transfers are below:
Tax on the interstate transfer of a firearm
A Washington gun dealer is required to collect use tax from a Washington buyer at the time the firearm is delivered to the buyer. Use tax is collected on the total purchase price, including freight/delivery and insurance charges.
If the purchase price is not evident, it is up to the gun dealer to determine the taxable amount by either requiring the purchaser to show the purchase price or by obtaining the selling price from the out-of-state seller.
If for whatever reason, the Washington dealer is still unable to obtain the original purchase price, the current fair market value of the firearm should be used. (RCW 82.12.010) Current fair market values may be determined by the insured value, a recent appraisal, or a reliable resource such as a respected publisher of gun values. (Values are subject to audit verification.)
Firearms as gifts
A firearm received as a gift is subject to use tax unless it can be shown that the prior owner paid retail sales or use tax. (RCW 82.12.010). The Washington dealer may use the current fair market value as the taxable amount to calculate the use tax.
Tax has already been paid
In cases where the firearm owner can provide proof of sales or use tax paid to Washington, the Washington dealer is not required to collect use tax. The Washington dealer must keep proof of tax paid. In cases where the firearm owner can provide proof of sales or use tax paid to other states, the firearm owner is eligible for a credit against the use tax for the amount of sales or use tax paid to the other state (RCW 82.12.035).
Tax on transfer fees
Neither sales tax nor use tax apply on any fees charged by the Washington gun dealer for processing the required state and federal paperwork.
In addition, use tax does not apply to the service charge for contacting the National Instant Criminal Background Check System (NICS) when the charge is stated separately from the selling price of the firearm and freight and/or delivery charges, insurance, etc.
Reporting the tax
The gross selling price of the firearm is reported under the use tax lines of the tax return.
The separately stated service charge for processing the required Federal and State forms and contacting the National Instant Criminal Background Check System (NICS) is reported under the service and other activities B&O tax classification. Sales tax does not apply on this charge.
RCW 82.12.040(1) states:
Every person who maintains in this state a place of business or a stock of goods, or engages in business activities within this state, shall obtain from the department a certificate of registration, and shall, at the time of making sales of tangible personal property, extended warranties, or sales of any service defined as a retail sale in RCW 82.04.050 (2)(a) or (3)(a), or making transfers of either possession or title, or both, of tangible personal property for use in this state, collect from the purchasers or transferees the tax imposed under this chapter. The tax to be collected under this section shall be in an amount equal to the purchase price multiplied by the rate in effect for the retail sales tax under RCW 82.08.020. (Emphasis added).