WAC 101

Taxicabs and Limousines

Administration.

Registration certificates--Threshold levels.

Tax warrant--Filing-Lien--Effect.

Unlawful acts--Penalties.

Tax registration and tax reporting. Provides guidance relating to tax reporting and registration requirements for businesses;

Tax registration and tax reporting. Effective 02/08/07.

Tax registration. Effective 4/17/95. Updated 1/13/00.

TAXPAYER HAS DUTY TO OBTAIN KNOWLEDGE OF TAX LIABILITY Cancelled 1/29/09 This ETA correctly states the principle that taxpayers have the responsibility to know their obligations. This matter is adequately addressed in Chapter 82.32A RCW (Taxpayer Rights and Responsibilities( and numerous publications of the Department.

B&O Tax Credit for Washington Customized Training Program Extended

B&O Tax Credit and Training Assistance for New and Expanding Businesses (Other Reference Rule 229 and Misc)

Fireworks Sales, Distributors and Retail Sales by Nonprofit Organizations Tax Registration and Reporting Requirements Information Notice

Reseller Permits to Replace Resale Certificates

Special Event Promoters and Vendors - New Requirements

Special Event Promoters - Requirements

B&O Tax Credit for Washington Customized Training Program Extended

Special Event Promoters - New Requirements as of May 2006

Special Event Promoters and Vendors - New Requirements (Originally issued July 1, 2003--Revised April 2004)

Temporary B&O Tax Rate Increase Small Business Credit Increase Active Non-Reporting Change

B&O TAX -- REAL ESTATE CONTRACTS -- INTEREST FROM -- ENGAGING IN BUSINESS. A taxpayer whose contract sale of real property is subject to B & O tax on interest derived therefrom does not cut off his liability for same by simply declaring his retirement. Interest payments earned from sales of business property which continue beyond his cessation of conventional business operations are B & O taxable as well.

B&O TAX -- EXEMPTION -- MONTHLY MINIMUM -- MINIMUM TAXABLE AMOUNT -- HUSBAND AND WIFE -- "PERSON" DEFINED -- MARITAL COMMUNITY. A marital community is not defined as a person. If a husband and wife have separate businesses, with separate registration numbers, each business is a separate "person" for purposes of the B&O tax minimum taxable amount exemption.

BUSINESS ACTIVITY DEFINED. The mere receipt of an intangible is an activity. When the receipt of an intangible is with object of gain, benefit, or advantage to someone, it is a business activity. Citing: Simpson Timber Co., v. State, Dept. of Rev., BTA Docket No. 30192A, B, C (1986).

ENGAGING IN BUSINESS DEFINED. All persons who are engaged in business in Washington are subject to excise taxes. Engaging in business is defined as continuing in business. The mere receipt by a composer of royalty payments for compulsory and performance licenses, and of a percentage of receipts from a merchandising contract, is a business activity subject to excise taxes. Therefore, the continuation of the receipt of those payments by the estate of the composer is an activity subject to excise taxes.

REGISTRATION WITH SECRETARY OF STATE - REGISTRATION WITH DEPARTMENT OF REVENUE - ABSENCE OF CONFLICT. RCW 23B.15.010 requires foreign corporations to obtain a certificate of authority from the Secretary of State before transacting business in Washington unless a specific exception applies. RCW 82.32.030 requires all persons who engage in business in Washington to obtain from the Department of Revenue a registration certificate. The two statutes serve different purposes and do not conflict.

REGISTRATION WITH DEPARTMENT OF REVENUE - AMOUNT OF GROSS INCOME AS EXCEPTION TO DUTY TO REGISTER. If a taxpayer satisfied the requirements of RCW 82.32.030(2) and Rule 101(2)(a), the taxpayer may choose not to register with the Department. However, the taxpayer's decision not to register is subject to future audit verification through the Department of Revenue's Audit Division and Tax Discovery Officers.

ACTIVE NON-REPORTING —LATE-PAYMENT PENALTIES —QUALIFICATIONS. When a taxpayer is either erroneously placed on active nonreporting status because of the taxpayer's errors in reporting or no longer qualifies for the status, late-payment penalties can be assessed for the periods of nonreporting.

PENALTY—WAIVER—ACTIVE NONREPORTER -TWENTY-FOUR MONTH PROVISION. Where a taxpayer ceases to qualify for the active non-reporting status but fails to file and pay tax, it qualifies for waiver under the twenty-four month provision for the first period in which it ceases to qualify for active nonreporting status, provided it had no late returns in the preceding twenty-four months.

B&O TAX - ENGAGING IN BUSINESS - SOS CERTIFICATE OF AUTHORITY. Even though a foreign corporation may not be transacting business under RCW 23B.15.010, that fact has no bearing for determining whether it is engaging in business in Washington for purposes of RCW 82.04.150.

PENALTY - WAIVER - REGISTERING OR BEING REGISTERED IS NOT A REQUEST FOR FORMS. A taxpayer has the right to receive, upon request, current tax forms. The Department will consider a waiver of penalties when a taxpayer has made a timely application in writing for the proper tax forms and the Department has not furnished them in sufficient time for the taxpayer to timely file. Registering or being registered is not a request for tax forms, and the Department is not obligated to send a registered taxpayer tax forms unless the taxpayer specifically requests the forms.

PENALTY - WAIVER -- NOTIFICATION OF ADMINISTRATIVE CLOSING OF ACCOUNT IS NOT INSTRUCTION; TAXPAYER OBLIGATION TO REQUEST THAT ACCOUNT REMAIN OPEN. The Department's notification that it has administratively closed a tax account is not an instruction that the taxpayer does not owe taxes. The taxpayer is responsible for knowing whether it still has a tax reporting obligation and, if the account should remain active, must request that it remain open.

Under RCW 82.04.080, WAC 458-20-101 (Rule 101), and WAC 458-20-273 (Rule 273), must the CSPs report their incentive payments from PUDs as gross income?

RULE 101; RCW 82.32.030: TAX REGISTRATION – INVOLUNTARY. The Department may involuntarily register a taxpayer when the Department find that taxpayer to be subject to taxation in Washington and that taxpayer has not voluntarily registered itself.

RULE 101(14); RCW 82.32.050(4): STATUTORY LIMITATION ON ASSESSMENTS. Where the taxpayer closed its account and rescinded its registration with the Department, we find no basis for limiting the statutory assessment period.

REGISTRATION TO DO BUSINESS -- HUSBAND AND WIFE -- COMMUNITY PROPERTY -- LIABILITY -- TAX DEBT. The finding that a husband and wife are each entitled to file returns for separate businesses does not necessarily require the conclusion that the separate businesses are also separate property for purposes of liability for tax debts. F.I.D.

B&O TAX--EXEMPTION -- MONTHLY MINIMUM -- MINIMUM TAXABLE AMOUNT -- HUSBAND AND WIFE -- "PERSON" -- DEFINITION. If a husband and wife have separate businesses, with separate registration numbers, each business is a separate "person" for purposes of the B&O minimum exemption. REVERSES PRIOR DEPARTMENT POLICY.

REGISTRATION TO DO BUSINESS -- HUSBAND AND WIFE -- COMMUNITY PROPERTY -- LIABILITY -- TAX DEBT. The finding that a husband and wife are each entitled to file returns for separate businesses does not necessarily require the conclusion that the separate businesses are also separate property for purposes of liability for tax debts.

B&O TAX--EXEMPTION -- MONTHLY MINIMUM -- MINIMUM TAXABLE AMOUNT -- HUSBAND AND WIFE - "PERSON" -- DEFINITION. If a husband and wife have separate businesses, with separate registration numbers, each business is a separate "person" for purposes of the B&O minimum exemption. Det. 88-159, WTD (1988).

B&O TAX - LACK OF KNOWLEDGE - UNREGISTERED TAXPAYER - BURDEN. Under the Washington Revenue Act, it is the taxpayer who has the burden of knowing his own tax liability.

REGISTRATION WITH DEPARTMENT -- REQUIRED TO COLLECT SALES TAXES -- ENGAGED IN TAXABLE BUSINESS ACTIVITIES. Where person is required to collect sales taxes and/or is engaged in a taxable business activity, the person is required to register with the Department of Revenue