Businesses that meet ALL of the following criteria are not required to file monthly, quarterly, or annual tax returns:
- Business activity does not require the collection of retail sales tax.
- Gross proceeds of sales, gross income, or value of products for all business and occupation tax classifications is less than $28,000 per year.
- Gross income of the business for all public utility tax classifications is less than $24,000 per year.
- The business does not owe any other tax or fee to the Department of Revenue.
Businesses that meet all of these qualifications are eligible for active non-reporting status. If your business is assigned this status, you are considered to be actively doing business in Washington, but you are not required to file tax returns. If at any time some of the above criteria is no longer valid, you have certain responsibilities as outlined below.
How can I change my filing status to active non-reporting?
If your business is currently assigned a monthly, quarterly, or annual filing status and you think your business would qualify for active non-reporting, please contact us.
What is considered a retail sale?
Businesses that make retail sales must file tax returns. Example of retail sales include:
- repairing, installing, altering, decorating, cleaning, constructing, or improving real or personal property for customers
- providing specific personal services, including:
- fitness testing and training
- aerobic classes
- tanning and tattoos
- steam and Turkish baths
- escort and dating services
- providing specific consumer services, including:
- landscape maintenance
- horticultural services
- clearing land and moving earth
- service charges for professional sports tickets
- rental and leasing of personal property
- rental of equipment with operator
- towing and automobile parking
- lodging (less than 30 days)
- amusement activities such as golf, billiards, bowling, etc.
- charges for abstract and title insurance, escrow and credit bureaus, and tenant screening
Businesses performing any of these transactions are required to be registered, and collect and remit retail sales tax on their tax returns. If you have any questions about whether you should collect retail sales tax or if you feel you do not qualify for the active non-reporting status, please contact us immediately. You will be assigned a reporting frequency and begin receiving tax returns.
What should I do if I exceed the limit?
It is your responsibility to maintain proper financial records and notify the Department if your business exceeds the $28,000 business and occupation and/or $24,000 public utility threshold for active non-reporting status. If at any time your gross income exceeds this threshold, a tax return must be filed and any tax due paid. Late filing and payment will cause penalties and interest to be assessed.
Call the Business Registration section at (360) 902-7180 or contact your local Department of Revenue field office if your account exceeds the thresholds. Your account will be assigned a reporting frequency and you will be sent tax returns to report your taxes.
Do I have other responsibilities?
As defined in the Taxpayer Rights and Responsibilities laws, businesses have a number of rights and responsibilities in regard to their tax obligations. One of your most important responsibilities is to notify the Department of changes that require an update on your account. In addition to the change noted above, other changes may include:
- new mailing address or business location
- new telephone number
- new partners or corporate officers
- closing date if you cease to do business in Washington State
You can notify the Department of any changes to your business' status
What if I owe use tax?
To pay use tax:
Who should I contact for more information?
Washington Department of Revenue
Business Registration Section
PO Box 47476
Olympia, WA 98504-7476
(360) 902-7180
Printable version (PDF) of the Active Nonreporting brochure