TPS-TIE

When buying the assets of a business, some are subject to sales or use tax, while others are not.

Items subject to retail sales tax

The following items (tangible personal property) are subject to sales tax:

Do I need to register and pay state taxes?

You are likely an independent contractor if you performed work for a business, individual, or any other organization and you received a Form 1099-MISC for your work. As an independent contractor, you are engaged in business in Washington.

You must register with and pay taxes to the Department of Revenue (DOR) if you meet any of the following:

A recent case before the Washington State Court of Appeals found that an out-of-state business regularly delivering fuel to Washington customers in its own trucks was subject to Washington’s wholesaling B&O tax. 

Similarly, if an out-of-state business regularly delivers goods in their own vehicles to consumers in Washington, those sales would be subject to retail sales tax and retailing B&O tax. 

  (Space Age Fuels, Inc. v State of Washington, 178 Wash.App. 756 (2013), review denied, 180 Wash.2d 1008 (2014))

Should sales tax be listed separately on receipts?

Yes. Washington sellers are required to list the retail sales tax separately from the selling price on any invoice, customer billing receipt, or any other contract of sale. This is required even when the seller and the buyer agree that the advertised price includes retail sales tax.

Can a seller advertise that tax is included in the selling price?

Yes. Washington sellers can advertise that sales tax is included in the price of their goods, or that the seller is paying the sales tax.

Effective October 15, 2015, Airbnb will collect and send the following taxes to the Department of Revenue (DOR) on behalf of Airbnb ‘hosts’ who use the website for short-term lodging sales:

• state and local retail sales tax
• special hotel/motel taxes
• convention and trade center taxes

(See Airbnb’s public policy statement for more information).

If a host made lodging sales before October 15, 2015, the host needs to collect and send all taxes to the department for that time period.

Direct selling organizations sell products to consumers using independent consultants. As used in this article, “independent consultants” means home based businesses, independent representatives, independent contractors, etc.

You may need to register

As an independent consultant, you may need to register with Revenue depending on if your organization has a tax collection agreement with Revenue or if you have other business activities.

Many self-publishing authors use a marketplace facilitator to market, sell and distribute their books. Here are two common methods marketplaces use to distribute self-published books:

Valet services are not subject to retail sales tax when both of the following conditions are met:

• The valet parking services are provided at a location where the valet is not also providing the parking lot or garage. 
• There is no charge to the vehicle driver/owner for valet or parking services.

If both conditions are met, the income the valet service receives is subject to business and occupation (B&O) tax under the service and other activities classification.

When is retail sales tax applicable?

This article will help you determine the classification for interior cleaning charges. Generally, cleaning services are subject to retail sales tax. However, if a company performs routine and repetitive “janitorial services,” described in WAC 458-20-172, the company’s receipts are not subject to retail sales tax.

Individual fishing quotas (IFQs) are a type of “catch share” regulated by the U.S. government. They are permits to harvest specific quantities of fish or shellfish.

IFQ permits held for exclusive use by a person, are intangible rights. There are two different business and occupation (B&O) tax treatments for IFQs depending on whether they are leased or sold.