TPS-TIE

Are parking fees subject to sales tax?

It depends. Whether sales tax is due on parking fees is based on:

• The duration of the parking agreement.
• If designation of a parking spot is assigned.

Hourly parking at lots or garages

Parking fees for hourly parking in garages or parking lots are subject to sales tax. It makes no difference whether the parking structure is owned by the local government or a private company. It also makes no difference whether the lot is attended or unattended.

Persons who lease tangible personal property and are charged property tax by the leasing company must pay retail sales tax on the total rental charge, including the amount due for property tax. The total rental charge is also subject to retailing business and occupation (B&O) tax. 

Barter transactions are considered income for tax reporting purposes and are subject to business and occupation (B&O) tax and retail sales tax, if appropriate. The measure of tax on a barter transaction is the value of goods or services ‘actually received or accrued’ in lieu of any monetary payment for such goods or services.

Caterers must pay retail sales tax on certain items they use in the course of providing catering services. This is true even though some items may be listed separately on the customer’s invoice as “rentals.”

Generally, purchases that will be used exclusively for rental are considered purchases for resale and exempt from retail sales tax. This is also true for items rented or leased exclusively for resale.

Q: Is the exterior washing of windows a janitorial service?

A: Yes. Both the interior and exterior window washing are considered to be janitorial services when they are not part of a special clean up job such as clean up after construction. Therefore, retail sales tax is not collected on the charges for washing windows. The contractor owes B&O tax under the Service and Other Activities classification on the gross income from these services. WAC 458-20-172 provides:

Hearing aid batteries (and hearing aids) are exempt from retail sales tax when they are prescribed by a person licensed to prescribe, fit, or furnish prosthetic devices and their components and sold by a licensed seller.

A home warranty is a contract between a homeowner and a home warranty company that covers the repair or replacement of covered systems and appliances if they break down due to normal wear and tear. Generally, the homeowner pays a monthly or annual fee for the warranty and may pay a service fee to the technician and/or a deductible.

What do home warranties cover?

Home warranties that cover real property (property that is affixed to the home) may include:

When a business contracts to perform cleanup on foreclosed properties for consumers (e.g., for banks, realtors, or investors), they often provide a combination of services for either an agreed-upon lump sum price or an amount to be based on the actual time spent cleaning up the property. These services are considered special cleanup jobs and may include, but are not limited to:

Fire districts, or fire protection districts, are subject to business and occupation (B&O) tax on certain income. However, they are not subject to the B&O tax on amounts earned from activities that are exclusively governmental.

Fire districts are created to provide fire protection for citizens and property within their geographic district. Fire districts are required to have a plan in place to deal with disasters beyond the resources of a single fire district.