Current through Register Vol. 24-06, March 15, 2024
(1)
Introduction. This rule explains
the application of business and occupation (B&O), retail sales, and use
taxes to persons operating:
* Hospitals as defined in
RCW
70.41.020;
* Nursing homes as defined in
RCW
18.51.010;
* Assisted living facilities as defined in
RCW
18.20.020;
* Adult family homes as defined in
RCW
70.128.010;
* Senior living communities as defined in
RCW
82.04.040; and
* Similar health care facilities.
(a)
Examples. This rule contains
examples that identify a number of facts and then state a conclusion. The
examples should be used only as a general guide. The tax results of other
situations must be determined after a review of all of the facts and
circumstances.
(b)
Other
rules that may apply. Readers may want to refer to the rules in the
following list for additional information:
(i)
WAC 458-20-102 Reseller
permits.
(ii) WAC
458-20-111 Advances and
reimbursements.
(iii) WAC
458-20-150 Optometrists,
ophthalmologists, and opticians.
(iv) WAC
458-20-151 Dentists,
audiologists, and other health care providers-Dental laboratories and dental
technicians.
(v) WAC
458-20-169 Nonprofit
organizations.
(vi) WAC
458-20-178 Use tax and the use of
tangible personal property.
(vii)
WAC 458-20-18801 Medical substances,
devices, and supplies for humans-Drugs prescribed for human use-Medically
prescribed oxygen -Prosthetic devices-Mobility enhancing equipment-Durable
medical equipment.
(viii) WAC
458-20-233 Tax liability of
medical and hospital service bureaus and associations and similar health care
organizations.
(2)
Personal and professional services
of hospitals. For purposes of this rule, the following definitions
apply:
* "Hospital" - The term hospital is as defined in
RCW
70.41.020. It includes hospitals that come
within the scope of chapter 71.12 RCW, but only if they are also licensed under
chapter 70.41 RCW.
* "Public hospital" or "nonprofit
hospital" - Public or nonprofit hospitals are hospitals operated by the
state or any of its political subdivisions or operated as nonprofit
corporations.
(a)
Hospital
services to patients. Gross income earned by hospitals for providing
personal or professional services to patients is subject to B&O tax as
shown in the table below.
RCW
82.04.260.
Report Income From Providing
Personal or Professional Services
|
Reporting
Classification
|
For profit hospitals
|
For profit hospitals B&O tax classification
|
Public and nonprofit hospitals
|
Public or nonprofit hospitals B&O tax
classification
|
Gross income earned for providing nonmedical services, interest
received on patient accounts receivable, and amounts earned for providing
transcribing services to physicians are subject to service and other activities
B&O tax.
(b)
Clinics and departments operated by hospitals. Gross income earned
by medical clinics and departments providing services to patients and operated
by a hospital is subject to B&O tax as shown in subsection (2)(a) of this
rule, where the operation of a medical clinic or department is covered by the
hospital's license. If the clinic or department is not covered by the
hospital's license, the gross income earned by a medical clinic or department
providing services to patients is subject to B&O tax under the service and
other activities B&O tax classification.
(i)
Example 1. Acme Hospital is
a nonprofit hospital that has a medical clinic that is physically located
within the hospital. The clinic is open only during the hours of 8:00 a.m. to
5:00 p.m., and provides no domiciliary care or overnight facilities to its
patients. The medical clinic is covered under Acme Hospital's hospital license.
Gross income earned by the medical clinic for providing patient care is subject
to the Public and Nonprofit Hospital B&O Tax Classification because the
clinic is covered under the hospital license.
(ii)
Example 2. Mountain
Hospital is a for profit hospital with a cancer treatment facility that is
located one mile from the hospital campus. The cancer treatment facility
provides the type of services normally provided by hospitals to cancer patients
but only during regular business hours. The cancer treatment facility is
covered under the hospital's license. Gross income earned by the cancer
treatment facility is subject to the For Profit Hospitals B&O tax
classification because the facility is covered under the hospital's
license.
(c)
Educational programs and services. Amounts earned by public or
nonprofit hospitals for providing educational programs and services to the
general public are subject to B&O tax under the public or nonprofit
hospitals classification if the educational programs and services are an
integral, interrelated, and essential part of the hospital. Otherwise, such
amounts are subject to B&O tax under the service and other activities
classification. Educational services are considered an integral, interrelated,
and essential part of the hospital only if they are unique and incidental to
the provision of hospitaliza-tion services. Only those educational programs and
services offered by a hospital that would be very difficult or impossible to
duplicate by a person other than a hospital because of the specialized body of
knowledge, facilities, and equipment required are unique and incidental to the
provision of hospitalization services. Amounts received from educational
programs and services are subject to the service and other activities B&O
tax when the educational programs or services could be provided by any
physician, clinic, or trained lay person.
(3)
Personal and professional services
from other medical clinics, nursing homes, and similar health care
facilities. Gross income earned by medical clinics, nursing homes, and
similar health care facilities for providing personal and professional services
is subject to service and other activities B&O tax. Physicians performing
these services are also subject to service and other activities B&O tax on
gross income earned. Services provided are ones not integral, interrelated, and
an essential part of a hospital operation.
(4)
Assisted living facilities and
domiciliary care. For the purpose of this rule, "assisted living
facilities" and "domiciliary care" have the same meaning as found in
RCW
18.20.020. A preferential B&O tax rate is
provided by
RCW
82.04.2908 to persons operating assisted
living facilities licensed under chapter 18.20 RCW. Persons operating licensed
assisted living facilities should report their gross income derived from
providing room and domiciliary care to residents under the licensed assisted
living facilities B&O tax classification. Refer to subsection (9)(h) of
this rule for B&O tax deductions and exemptions available to persons
operating assisted living facilities.
(5)
Hospitals or other health care
facilities operated by the state of Washington. Gross income earned by
the state of Washington for operating a hospital or other health care
facilities, whether or not owned by the state, is not subject to B&O
tax.
(6)
Nonprofit
corporations and associations performing research and development. A
separate B&O tax rate applies to nonprofit corporations and nonprofit
associations for gross income earned in performing research and development
within this state, including medical research. See
RCW
82.04.260.
(7)
Sales of tangible personal
property. Retailing B&O tax applies to sales of tangible personal
property sold and billed separately from the performance of personal or
professional services by hospitals, nursing homes, assisted living facilities,
adult family homes, and similar health care facilities. This includes charges
for making copies of medical records. The seller must collect retail sales tax
from the buyer and remit the tax to the department unless the sale is
specifically exempt by law.
(a)
Tangible
personal property used in providing medical services to patients.
Retailing B&O and retail sales taxes do not apply to charges to a patient
for tangible personal property used in providing medical services to the
patient, even if separately billed. Tangible personal property used in
providing medical services is not considered to have been sold separately from
the medical services simply because those items are separately invoiced. These
charges, even if separately itemized, are for providing medical services.
For example, when a hospital charges a patient for drugs
physically administered by the hospital staff, the charges to the patient are
subject to B&O tax under the appropriate tax classification as shown in
subsection (2)(a) of this rule based on the hospital making the charge.
However, charges for drugs sold to persons or their care-givers, either for
self-administration or administration by a caregiv-er other than the seller,
are subject to retailing B&O tax and retail sales tax unless specifically
exempt by law. Readers should refer to WAC
458-20-18801 for detailed
information regarding retail sales tax exemptions that apply to sales of
prescription drugs and other medical items.
(b)
Sales of food, drinks, and
meals. Although the sale of food, drinks, or meals is generally
considered to be a retail sale:
(i) Hospitals,
nursing homes, assisted living facilities, and similar health care facilities
that furnish meals to patients or residents as a part of the services provided
to those patients or residents are not considered to be making retail sales of
meals. Thus, such amounts are not subject to retail sales tax. However, amounts
earned by hospitals, nursing homes, assisted living facilities, and similar
health care facilities for furnishing meals to patients or residents are
subject to B&O tax as part of the services provided to those patients or
residents;
(ii) Senior living
communities that furnish food, drinks, or meals to tenants as a part of a
rental or residency agreement for which no separate charge is made, regardless
of whether the tenant is a resident for purposes of chapter 18.20 or 18.390
RCW, are not considered to be making retail sales of food, drinks, or meals.
Thus, such sales are not subject to retail sales tax. However, amounts earned
by senior living communities for furnishing food, drinks, or meals to tenants,
as described in this subsection (7)(b)(ii), are subject to B&O tax as part
of the services provided to those tenants.
RCW
82.04.040;
(iii)
RCW
82.08.0293 and
82.12.0293 provide, respectively,
retail sales tax and use tax exemptions for prepared meals sold to senior
citizens, disabled persons, or low-income persons by a nonprofit organization
organized under chapter 24.03A or 24.12 RCW. The exemptions apply to sales of
prepared meals to nonprofit organizations organized under chapter 24.03A or
24.12 RCW, that provide the meals to senior citizens, disabled persons, or
low-income persons as a part of the patient services they render; and
(iv) Hospitals, nursing homes, assisted
living facilities, and similar health care facilities may have restaurants,
cafeterias, or other dining facilities where meals are sold to doctors,
employees, and visitors. These sales of meals are subject to retailing B&O
and retail sales taxes. For additional information regarding the sale of meals,
including meals furnished to employees, refer to WAC
458-20-124.
(8)
Industry
reporting. This subsection discusses common reporting issues affecting
persons operating medical or other health care facilities.
(a)
Adjustments to revenues.
Many hospitals provide medical care without charge or where some portion of the
charge will be canceled. In other cases, medical care is billed to patients at
"standard" rates but is later adjusted to reduce the charges to the rates
established by contract with medicare, medicaid, or private insurers. In these
situations, the hospital must initially include the total charges as billed to
the patient as gross income unless the hospital's records clearly indicate the
amount of income to which it will be entitled under its contracts with
insurance carriers. Where tax returns are initially filed based on gross
charges, an adjustment may be taken on future tax returns after the hospital
has adjusted its records to reflect the actual amounts collected. In no event
may the hospital reduce the amount of its current gross income by amounts that
were not previously reported on its excise tax return. If the tax rate changes
from the time the B&O tax was first paid on the gross charges and the time
of the adjustment, the hospital must file amended tax returns to report the
B&O tax on the transaction as finally completed at the rate in effect when
the service was performed.
(b)
Tax consequences if a hospital contracts with an independent contractor
to provide medical services at the hospital. When a hospital contracts
with an independent contractor (service provider) to provide medical services,
such as managing and staffing the hospital's emergency department, the hospital
may not deduct the amount paid to the service provider from its gross income.
If, however, the patients are alone liable for paying the service provider, and
the hospital has no personal liability, either primarily or secondarily, for
paying the service provider, other than as agent for the patients, then the
hospital may deduct from its gross income the amount it receives and pays to
the service provider.
In addition, the service provider is subject to service and
other activities B&O tax on the amount earned from the hospital for
providing these services for the hospital. If the service provider subcontracts
with a third party, such as a physician or nurse, to help provide medical
services as an independent contractor, the service provider may not deduct from
its gross income amounts paid to the subcontractor where the service provider
is personally liable, either primarily or secondarily, for paying the
subcontractor. If, however, the hospital is alone liable for paying the
subcontractor, and the service provider has no personal liability, either
primarily or secondarily, other than as agent for the hospital, then the
service provider may deduct from its gross income the amount it receives from
the hospital and pays to the subcontractor. For additional information
regarding deductible advances and reimbursements, refer to WAC
458-20-111.
(c)
Nursing homes and assisted living
facilities may not claim a B&O tax exemption for the rental of real
estate. The purpose of nursing homes is to provide medical care to their
residents. The purpose of assisted living facilities is to assume general
responsibility for the safety and well-being of their residents and to provide
other services to residents such as housekeeping, meals, laundry, and
activities. Assisted living facilities may also provide residents with
assistance with activities of daily living, health support services, and
intermittent nursing services. Because the purpose of nursing homes and
assisted living facilities is to provide services and not to lease or rent real
property, no part of the gross income of nursing homes or assisted living
facilities is exempted from B&O tax as the rental of real estate.
(9)
B&O tax deductions,
credits, and exemptions. This subsection provides information about
B&O tax deductions, credits, and exemptions available to persons operating
medical or other health care facilities.
Deductible amounts should be included in the gross income
reported on the combined excise tax return and then identified on the
appropriate deduction detail line of the return to determine the amount of
taxable income.
(a)
Organ
procurement organizations.
RCW
82.04.326 provides a B&O tax exemption
for amounts earned by a qualified organ procurement organization under
42 U.S.C. Sec.
273(b) in effect as of
January 1, 2001, to the extent that the amounts are exempt from federal income
tax.
(b)
Contributions,
donations, and endowment funds.
RCW
82.04.4282 provides a B&O tax deduction
for amounts received as contributions, donations, and endowment funds,
including grants, which are not in exchange for goods, services, or business
benefits. For example, a B&O tax deduction is allowed for donations
received by a public hospital, as long as the donors do not receive any goods,
services, or any business benefits in return. On the other hand, a public
hospital may not take a B&O tax deduction on amounts earned from a state
university for work-study programs or training seminars, because the university
receives business benefits in return, as students receive education and
training while enrolled in the university's degree programs.
(c)
Adult family homes.
RCW
82.04.327 provides a B&O tax exemption
for gross income derived from personal and professional services of adult
family homes licensed by the department of social and health services (DSHS),
or which are specifically exempt from licensing under the rules of DSHS. This
exemption does not apply to persons who provide home care services to clients
in the clients' own residences.
For the purpose of this rule, "adult family home" has the same
meaning as in
RCW
70.128.010.
(d)
Nonprofit kidney dialysis
facilities, hospice agencies, and nonprofit nursing homes and homes for unwed
mothers.
RCW
82.04.4289 provides a B&O tax exemption
for amounts earned as compensation for services rendered to patients or from
sales of drugs for human use pursuant to a prescription furnished as an
integral part of services rendered to patients by kidney dialysis facilities
operated as a nonprofit corporation, nonprofit hospice agencies licensed under
chapter 70.127 RCW, nonprofit nursing homes and homes for unwed mothers
operated as religious or charitable organizations. This exemption applies only
if no part of the net earnings earned by such an institution inures, directly
or indirectly, to any person other than the institution entitled to this
exemption. This exemption is available to nonprofit hospitals for income from
the operation of kidney dialysis facilities if the hospital accurately
identifies and accounts for the income from this activity.
Examples of nonprofit nursing homes include nursing homes
operated by church organizations or by nonprofit corporations designed to
assist alcoholics in recovery and rehabilitation. Nursing homes and homes for
unwed mothers operated by governmental entities, including public hospital
districts, do not qualify for the B&O tax exemption provided in
RCW
82.04.4289.
(e)
Government payments made to health
or social welfare organizations.
RCW
82.04.4297 provides a B&O tax deduction
to health or social welfare organizations, as defined in
RCW
82.04.431, for amounts earned directly from
the United States, any instrumentality of the United States, the state of
Washington, or any municipal corporation or political subdivision of the state
of Washington as compensation for health or social welfare services.
RCW 82.04.4275 provides a B&O
tax deduction for amounts health or social welfare organizations receive as
compensation for providing child welfare services under a government-funded
program.
A deduction is not allowed, however, for amounts that are
received under an employee benefit plan. For purposes of the deduction provided
by RCW
82.04.4297, "employee benefit plan" includes
any plan, trust, commingled employee benefit trust, or custodial arrangement
that is subject to the Employee Retirement Income Security Act of 1974, as
amended, 29 U.S.C. Sec.
1001 et seq., or that is described in
sections 125, 401, 403, 408, 457, and 501 (c)(9) and (17) through (23) of the
Internal Revenue Code of 1986, as amended, or a similar plan maintained by a
state or local government, or a plan, trust, or custodial arrangement
established to self-insure benefits required by federal, state, or local
law.
(f)
Amounts
earned under a health service program subsidized by federal or state
government.
RCW
82.04.4311 provides a B&O tax deduction
to:
* A public hospital that is owned by a municipal corporation or
political subdivision; or
* A nonprofit hospital; or
* A nonprofit community health center; or
* A network of nonprofit community health centers, that
qualifies as a health and social welfare organization as defined in
RCW
82.04.431, for amounts earned as compensation
for health care services covered under the federal medicare program authorized
under Title XVIII of the federal Social Security Act; medical assistance,
children's health, or other program under chapter 74.09 RCW; or for the state
of Washington basic health plan under chapter 70.47 RCW. This deduction applies
to amounts received directly or through a third party from the qualified
programs or plans. However, it does not apply to amounts received from patient
copayments or patient deductibles. For purposes of the deduction provided by
RCW
82.04.4311, "community health center" means a
federally qualified health center as defined in
42 U.S.C. Sec.
1396d as existed on August 1, 2005.
Example 3. Acme Hospital is a nonprofit hospital
that qualifies as a health and social welfare organization as defined in
RCW
82.04.431. Acme receives $1,000 for providing
health care services to Jane, who qualifies for the federal medicare program
authorized under Title XVIII of the federal Social Security Act. Jane is
covered in a health care plan that is a combination of medicare, which is
B&O tax deductible by Acme, and a medicare plus plan, which is paid for by
Jane and is not B&O tax deductible by Acme. Jane pays $20 to Acme as
patient copayments. Medicare pays $600 to Acme for the health care services,
and the medicare plus plan pays $380. Acme may deduct only the $600 received
from medicare.
(g)
Blood and tissue banks. Except as otherwise provided,
RCW
82.04.324 provides a B&O tax exemption
for amounts earned by a qualifying blood bank, a qualifying tissue bank, or a
qualifying blood and tissue bank to the extent such amounts are exempt from
federal income tax.
For the purposes of this exemption, the following definitions
apply:
(i)
Qualifying blood
bank. "Qualifying blood bank" means a blood bank that qualifies as an
exempt organization under 26
U.S.C. 501 (c)(3) as
existing on June 10, 2004, that is registered under 21 C.F.R., Part 607 as
existing on June 10, 2004, and whose primary business purpose is the
collection, preparation, and processing of blood.
"Qualifying blood bank" does not include a comprehensive cancer
center that is recognized as such by the National Cancer Institute.
(ii)
Qualifying tissue
bank. "Qualifying tissue bank" means a tissue bank that qualifies as an
exempt organization under 26
U.S.C. 501 (c)(3) as
existing on June 10, 2004, is registered under 21 C.F.R., Part 1271 as existing
on June 10, 2004, and whose primary business purpose is the recovery,
processing, storage, labeling, packaging, or distribution of human bone tissue,
ligament tissue and similar musculoskeletal tissues, skin tissue, heart valve
tissue, or human eye tissue. "Qualifying tissue bank" does not include a
comprehensive cancer center that is recognized as such by the National Cancer
Institute.
(iii)
Qualifying
blood and tissue bank. "Qualifying blood and tissue bank" means a bank
that qualifies as an exempt organization under
26 U.S.C.
501 (c)(3) as existing on
June 10, 2004, is registered under 21 C.F.R., Parts 607 and 1271 as existing on
June 10, 2004, and whose primary business purpose is the collection,
preparation, and processing of blood, and the recovery, processing, storage,
labeling, packaging, or distribution of human bone tissue, ligament tissue and
similar musculoskeletal tissues, skin tissue, and heart valve tissue.
"Qualifying blood and tissue bank" does not include a
comprehensive cancer center that is recognized as such by the National Cancer
Institute.
(h)
Assisted living facilities.
RCW
82.04.4337 provides a B&O tax deduction
to licensed assisted living facility operators for amounts earned as
compensation for providing adult residential care, enhanced adult residential
care, or assisted living services under contract with the department of social
and health services authorized by chapter 74.39A RCW to residents who are
medicaid recipients. For the purpose of this rule, "adult residential care,"
"enhanced adult residential care," and "assisted living services" have the same
meaning as in
RCW
74.39A.009.
In addition,
RCW
82.04.4264 provides a B&O tax exemption
for amounts earned by a nonprofit assisted living facility licensed under
chapter 18.20 RCW for providing room and domiciliary care to residents of the
assisted living facility. For purposes of this rule, "nonprofit assisted living
facility" means an assisted living facility that is operated as a religious or
charitable organization, is exempt from federal income tax under
26 U.S.C. Sec.
501 (c)(3), is incorporated
under chapter 24.03A RCW, is operated as part of a nonprofit hospital, or is
operated as part of a public hospital district.
(i)
Comprehensive cancer
centers.
RCW
82.04.4265 provides a B&O tax exemption
for amounts earned by a comprehensive cancer center to the extent such amounts
are exempt from federal income tax. For purposes of this rule, "comprehensive
cancer center" means a cancer center that has written confirmation that it is
recognized by the National Cancer Institute as a comprehensive cancer center
and that qualifies as an exempt organization under
26 U.S.C. Sec.
501 (c)(3) as existing on
July 1, 2006.
(j)
Prescription drugs administered by the medical service provider.
RCW
82.04.620 allows a deduction from the measure
of tax for reporting under the service and other activities classification of
the B&O tax (RCW 82.04.290) for amounts earned
by physicians or clinics for drugs for infusion or injection by licensed
physicians or their agents for human use pursuant to a prescription. This
deduction only applies to amounts that:
(i)
Are separately stated on invoices or other billing statements;
(ii) Do not exceed the then current federal
rate; and
(iii) Are covered or
required under a health care service program subsidized by the federal or state
government.
For the purpose of this deduction only, amounts that "are
covered or required under a health care service program subsidized by the
federal or state government" include any required drug copayments made directly
from the patient to the physician or clinic.
(A) "Federal rate" means the rate at or below
which the federal government or its agents reimburse providers for prescription
drugs administered to patients as provided for in the medicare, Part B, drugs
average sales price information resource as published by the United States
Department of Health and Human Services, or any index that succeeds
it.
(B) The deduction is available
on an "all or nothing" basis against the total amount earned for a specific
drug charge. If the total amount earned by the physician or clinic for a
specific drug exceeds the federal reimbursement rate, none of the total amount
earned qualifies for the deduction (including any required copayment received
directly from the patient). In other words, a physician or clinic may not
simply take an "automatic" deduction equal to the federal reimbursement rate
for each drug.
(C) For physicians
or clinics reporting taxes on the accrual basis, the total amount charged for a
drug must be included in the gross income at the time of billing if it is in
excess of the federal rate. However, in some cases the gross income from
charges may be adjusted, as indicated in subsection (8)(a) of this rule. If
such an adjustment to gross income is appropriate, the exemption discussed in
this subsection may also be taken at the time of billing if the adjustment
leaves the physician or clinic contractually liable to receive a total amount,
including any copayment received from the patient that does not exceed the
federal rate.
(10)
Sales, use, and other specified
taxes deductions and exemptions. Unless otherwise exempt by law,
hospitals, nursing homes, adult family homes, assisted living facilities, and
similar health care providers are required to pay retail sales tax on purchases
of equipment and supplies. The deductions and exemptions listed in this
subsection are available to qualified persons.
(a) For the purpose of this subsection, the
following definitions apply:
(i)
"Chemical" means any catalyst, solvent, water, acid, oil, or other
additive that physically or chemically interacts with blood, bone, or
tissue.
(ii)
"Materials" for the purposes of
RCW
82.08.02807 means any item of tangible
personal property including, but not limited to, bags, packs, collecting sets,
filtering materials, testing reagents, antisera, and refrigerants, used or
consumed in performing research on, procuring, testing, processing, storing,
packaging, distributing, or using blood, bone, or tissue.
(iii)
"Medical supplies" means
any item of tangible personal property, including any repair and replacement
parts for such tangible personal property, used by a comprehensive cancer
center for the purpose of performing research on, procuring, testing,
processing, storing, packaging, distributing, or using blood, bone, or tissue.
The term includes tangible personal property used to:
(A) Provide preparatory treatment of blood,
bone, or tissue;
(B) Control,
guide, measure, tune, verify, align, regulate, test, or physically support
blood, bone, or tissue; and
(C)
Protect the health and safety of employees or others present during research
on, procuring, testing, processing, storing, packaging, distributing, or using
blood, bone, or tissue.
(iv)
"Research" means basic and
applied research that has as its objective the design, development, refinement,
testing, marketing, or commercialization of a product, service, or
process.
(b)
Temporary medical housing provided by a health or social welfare
organization.
RCW
82.08.997 provides an exemption from state
and local retail sales taxes and lodging taxes for temporary medical housing
provided by a health or social welfare organization. The term "health or social
welfare organization" is defined in
RCW
82.04.431. "Temporary medical housing" means
transient lodging and related services provided to a patient or the patient's
immediate family, legal guardian, or other persons necessary to the patient's
mental or physical well-being.
(i) The
exemption applies to the following taxes:
(A)
Retail sales tax levied under
RCW
82.08.020;
(B) Lodging taxes levied under chapter 67.28
RCW;
(C) Convention and trade
center tax levied under chapter 36.100 RCW;
(D) Public facilities tax levied under
RCW
36.100.040; and
(E) Tourism promotion areas tax levied under
RCW
35.101.050.
(ii) The exemptions in this subsection apply
to charges made for"temporary medical housing" only:
(A) While the patient is receiving medical
treatment at a hospital required to be licensed under
RCW
70.41.090 or at an outpatient clinic
associated with such hospital, including any period of recuperation or
observation immediately following such medical treatment; and
(B) By a person that does not furnish lodging
or related services to the general public.
(c)
Purchases for resale.
Purchases of tangible personal property for resale without intervening use are
not subject to retail sales tax. Persons purchasing tangible personal property
for resale must furnish a copy of their reseller permit to the seller to
document the wholesale nature of the sale.
(d)
Sales of medical supplies,
chemicals, or materials to a comprehensive cancer center.
RCW
82.08.808 and
82.12.808 provide, respectively,
retail sales tax and use tax exemptions for sales of medical supplies,
chemicals, or materials to a comprehensive cancer center. These exemptions do
not apply to sales of construction materials, office equipment, building
equipment, administrative supplies, or vehicles.
(e)
Sales of medical supplies,
chemicals, or materials to organ procurement organizations.
RCW
82.08.02807 and
82.12.02749 provide, respectively,
retail sales tax and use tax exemptions for sales of medical supplies,
chemicals, or materials to organ procurement organizations exempt under
RCW
82.04.326. These exemptions do not apply to
the sale of construction materials, office equipment, building equipment,
administrative supplies, or vehicles.
(11)
Buyer's responsibility to remit
deferred sales or use tax. If the seller does not collect retail sales
tax on a retail sale, the buyer must remit the retail sales tax, commonly
referred to as "deferred sales tax", or use tax directly to the department
unless the purchases are specifically exempt by law. For detailed information
regarding the use tax, refer to WAC
458-20-178.
(a)
Reporting deferred sales or use
tax. Persons registered with the department and required to file tax
returns should report deferred sales or use tax on their combined excise tax
return. As the combined excise tax return does not have a separate line for
reporting deferred sales tax, the buyer should report the tax liability on the
use tax line. If a deferred sales tax or use tax liability is incurred by a
person who is not required to be registered with the department, the person
must report the tax on a "Consumer Use Tax Return" and remit the appropriate
tax to the department.
(b)
Consumer Use Tax Return. The Consumer Use Tax Return may be
obtained from the department's website at dor.wa.gov, or by calling the
department's telephone information center at 1-360-705-6705.
Statutory Authority:
RCW
82.32.300,
82.01.060(2),
chapters
82.04,
82.08,
82.12 and
82.32 RCW. 10-06-069, §
458-20-168, filed 2/25/10, effective 3/28/10. Statutory Authority:
RCW
82.32.300 and
82.01.060(2).
08-16-057, § 458-20-168, filed 7/30/08, effective 8/30/08; 05-14-090,
§ 458-20-168, filed 6/30/05, effective 7/31/05. Statutory Authority:
RCW
82.32.300 and
82.04.260(15).
94-11-097, § 458-20-168, filed 5/17/94, effective 6/17/94. Statutory
Authority:
RCW
82.32.300. 88-01-050 (Order 87-9), §
458-20-168, filed 12/15/87; 87-05-042 (Order 87-1), § 458-20-168, filed
2/18/87; 83-07-033 (Order ET 83-16), § 458-20-168, filed 3/15/83.
Statutory Authority:
RCW
82.01.060(2) and
82.32.300. 78-07-045 (Order ET
78-4), § 458-20-168, filed 6/27/78; Order ET 74-2, § 458-20-168,
filed 6/24/74; Order ET 70-3, § 458-20-168 (Rule 168), filed 5/29/70,
effective 7/1/70.