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Attributing royalty income
Royalty income is attributed under a hierarchy. This means you only move to the next step if you are unable to attribute under the current step.
The hierarchy for attributing royalty income is as follows:
TPS-TIE
Attributing service income
Service income is attributed under a hierarchy. This means you only move to the next step if you are unable to attribute under the current step.
The department expects most taxpayers will attribute apportionable receipts based on attribution tier #1 because the taxpayer will either have enough information to know where the customer receives the benefit of the service, or there is generally a reasonable method of proportionally attributing receipts available.
The hierarchy for service income is as follows:
Apportionable activities
Apportionable income includes income reported under the following business and occupation (B&O) tax classifications:
Apportionment – the basics
For business and occupation (B&O) tax purposes, apportionment refers to the use of a formula to allocate a business’ income to the appropriate taxing jurisdictions.
If you are a business that is taxable in Washington and another state, you must use our apportionment formula to determine how much of your apportionable income is subject to B&O tax in Washington.
Taxable in another state means your business meets any of the following requirements in the current or prior calendar year:
Business Tax Basics - Seattle
Attend a free tax workshop to learn about your tax reporting responsibilities. We will discuss tax classifications, deductions, sales tax collection, and recordkeeping requirements. You'll also have the opportunity to ask questions about taxes that apply specifically to your business.
2024 Tax Legislation
Below are summaries of tax-related bills passed by the legislature and signed into law by Gov. Inslee during the 2024 legislative session.
Business Tax Basics - Bothell
Attend a free tax workshop to learn about your tax reporting responsibilities. We will discuss tax classifications, deductions, sales tax collection, and recordkeeping requirements. You'll also have the opportunity to ask questions about taxes that apply specifically to your business.
Business Tax Basics - Bothell
Attend a free tax workshop to learn about your tax reporting responsibilities. We will discuss tax classifications, deductions, sales tax collection, and recordkeeping requirements. You'll also have the opportunity to ask questions about taxes that apply specifically to your business.
Business Tax Basics - Bothell
Attend a free tax workshop to learn about your tax reporting responsibilities. We will discuss tax classifications, deductions, sales tax collection, and recordkeeping requirements. You'll also have the opportunity to ask questions about taxes that apply specifically to your business.
