I received this notice from the Department of Revenue for a neighborhood non profit that I am the treasurer. We do not give any live presentations, but do get some from city employees which can not accept payment from us. We use the non profit to get donations for our annual Night Out Against crime.

Webpage for further guidance dor.wa.gov/NewRetailServices

Questions 360-705-6705

OK so what does that mean to a Washington Genealogical Society when they have a “Live Presentation”? It means we have to pay sales tax to the provider of the presentation. So for example if we have Cyndi Ingle give a presentation we must pay sales tax to Cyndi and she sends it in to Washington State. What happens if we pay say Judy Russell? Will she have to sign up with our Department of Revenue and pay the sales tax? I will guess she will be exempt from collecting Washington State Sales Tax, since according to the Wayfair Supreme Court Case she must do at least $100,000.00 worth of sales in Washington before she has to collect and pay the Sales Tax. So does that mean the Washington genealogical societies do not have to pay the tax? No it means they have to sign up with the Department of Revenue and pay use tax directly to Washington State.

In Washington, use tax is imposed on businesses when they acquire tangible personal property or certain services for use in the state, and Washington retail sales tax was not paid. This often happens with purchases from out-of-state vendors. The use tax rate is the same as the combined state and local sales tax rate for the location where the business first uses the item. 

How use tax works for businesses

Businesses must self-report and remit use tax directly to the Washington Department of Revenue (DOR). The tax is typically filed using the business’s regular Excise Tax Return. The use tax is due at the time of the first taxable use in Washington

Wayfair’s impact on the Marketplace Fairness Act

RCW 82.08.020 broadly imposes retail sales tax on each retail sale in Washington. See also Chapter 82.12 RCW (compensating use tax statute). Under RCW 82.08.0254 and 82.12.055, Washington sales or use tax applies unless prohibited under the Constitution or laws of the United States.

RCW 82.08.053 requires remote sellers and marketplace facilitators with $10,000 in retail sales in Washington to elect to either collect and remit sales and use tax, or comply with the use tax notice and reporting requirements in chapter 82.13 RCW.

On June 21, 2018, the U.S. Supreme Court decided South Dakota v. Wayfair, Dkt. No. 17-494, 06/21/2018. In Wayfair, the U.S. Supreme Court upheld a South Dakota law that imposed a sales tax collection obligation on sellers with more than $100,000 in sales or 200 transactions annually in South Dakota. Prior to that decision, states could only impose a sales tax collection obligation on sellers with a physical presence in the state under federal law.

The Wayfair decision represents a change in federal law that permits states to impose greater sales and use tax collection obligations on sellers than was previously allowed. Pursuant to RCW 82.32.733, the Department has determined this change in federal law creates a conflict with the “collect or report” election provisions of RCW 82.08.053. Specifically, under federal law as applied in Wayfair, Washington can require remote sellers and marketplace facilitators that have $100,000 in sales or 200 transactions in the state to collect sales and use tax on those sales. To the extent the “collect or report” election provided in RCW 82.08.053 would limit this authority to require sales and use tax collection, the election provision conflicts with the change in federal law and will have no further force and effect.

Effective October 1, 2018, remote sellers and marketplace facilitators that have $100,000 of gross retail sales or 200 retail transactions in the state during the current or prior calendar year are required to collect and remit sales tax on all taxable retail sales in Washington according to RCW 82.08.020 and 82.08.050. Additionally, for those remote sellers and marketplace facilitators meeting these requirements, the provisions of RCW 82.08.053 that provide the option to collect or comply with the use tax notice and reporting requirements in chapter 82.13 RCW will have no further force and effect. This notification satisfies the requirements of RCW 82.32.733.

Sellers with a physical presence in Washington must continue to collect sales and use tax on retail sales in Washington as is currently required.