Current through Register Vol. 24-06, March 15, 2024
(1)
Introduction. Effective for
calendar years in which a taxpayer claims a tax preference beginning January 1,
2018, Washington changed its annual reporting requirements. This rule addresses
how taxpayers taking certain tax preferences must file an annual survey as
provided under
RCW
82.32.585 with the department of revenue
(department) providing information about their business for tax periods through
December 31, 2017, only. See WAC
458-20-267 Annual tax performance
reports for certain tax preferences for the proper way to report tax
preferences for periods beginning January 1, 2018.
(a)
Definitions. For purposes of
this rule the following definitions apply:
(i)
Person. "Person" has the meaning under
RCW
82.04.030 and also includes the state and its
departments and institutions.
(ii)
Tax preference. As defined under
RCW
43.136.021, "tax preference" means:
(A) An exemption, exclusion, or deduction
from the base of a state tax; a credit against a state tax; a deferral of a
state tax; or a preferential state tax rate; and
(B) Includes only the tax preferences
requiring a survey under
RCW
82.32.585.
(b)
Annual reports. Taxpayers
taking certain tax preferences may be required to complete both an annual
report and an annual survey. For information on the annual report requirements,
refer to RCW 82.32.534 and WAC
458-20-267.
(c)
Examples. This rule includes
examples that identify a set of facts and then state a conclusion. These
examples should only be used as a general guide. The department will evaluate
each case on its particular facts and circumstances.
(2)
Tax preferences requiring an annual
survey. Taxpayers may refer to the department's website at dor.wa.gov
for the "Annual Tax Incentive Survey for Preferential Tax
Rates/Credits/Exemptions/Deferrals Worksheet." This worksheet lists tax
preferences that require an annual survey. Taxpayers may also contact the
telephone information center 360-705-6705 to determine whether they must file
an annual survey.
(3)
How to
file annual surveys.
(a)
Electronic filing. Surveys must be filed electronically unless the
department waives this requirement upon a showing of good cause. A survey is
filed electronically when the department receives the survey in an electronic
format. A person accesses electronic filing through their department "My
Account" at dor.wa.gov.
(b)
Required paper form. If the department waives the electronic
filing requirement for a person that shows good cause, that person must use the
annual survey form developed by the department unless that person obtains prior
written approval from the department to file an annual survey in an alternative
format.
(c)
How to obtain the
form. Persons who have received a waiver of the electronic filing
requirement from the department or who otherwise would like a paper copy of the
survey may obtain the annual survey form from the department's website at
dor.wa.gov. It may also be obtained by calling the telephone information center
at 360-705-6705, or by contacting the department at:
Attn: Tax Incentive Team
Taxpayer Account Administration
Department of Revenue
Post Office Box 47476
Olympia, WA 98504-7476
(d)
Special requirement for persons who
did not file an annual survey during the previous calendar year. If a
person is a first-time filer or otherwise did not file an annual survey with
the department during the previous calendar year, the survey must include
information on employment, wages, and employer-provided health and retirement
benefits for the two calendar years immediately preceding the due date of the
survey.
(e)
Due date of
annual survey. Every person claiming a tax preference that requires a
survey under
RCW
82.32.585 must file the survey annually with
the department in the year following the calendar year in which the person
becomes eligible to claim the tax preference. The due date for filing the
survey is as follows:
(i) April 30th for
surveys due prior to 2017.
(ii) May
31st for surveys due in 2017 or 2018.
(iii) If the tax preference is a deferral of
tax, the first survey must be filed by April 30th (if prior to 2017) or by May
31st (if in 2017) of the calendar year following the calendar year in which the
investment project is certified by the department as operationally complete.
Thereafter, a survey must also be filed for each of the seven succeeding
calendar years by April 30th (if prior to 2017) or by May 31st (if in 2017), or
a tax performance report for tax preferences claimed in tax reporting periods
in 2018 and after.
(f)
Due date extensions. The department may extend the due date for
filing annual surveys as provided in subsection (11) of this rule.
(g)
Example 1. Advanced
Computing, Inc. qualified for the B&O tax credit provided by
RCW
82.04.4452 and applied it against taxes due
in calendar year 2014. Advanced Computing filed an annual survey in March 2014
for credit claimed under
RCW
82.04.4452 in 2013. Advanced Computing must
electronically file an annual survey with the department by April 30, 2015, for
credits taken in calendar year 2014. The tax preference in this example expired
January 1, 2015.
(h)
Example
2. In 2011, Biotechnology, Inc. applied for and received a sales and use
tax deferral under chapter 82.63 RCW for an eligible investment project in
qualified research and development. The investment project was operationally
complete in 2012. Biotechnology filed an annual survey on April 30, 2013, for
the sales and use tax deferral under chapter 82.63 RCW. Surveys are due from
Biotechnology by April 30th each year through 2016 and by May 31st in 2017 and
2018, with tax performance reports due in 2019 through May 31, 2020.
(i)
Example 3. Advanced
Materials, Inc., a new business in 2014, has been conducting manufacturing
activities in a building leased from Property Management Services. Property
Management Services is a recipient of a deferral under chapter 82.60 RCW, and
the department certified the building as operationally complete in 2014. To
pass on the entire economic benefit of the deferral, Property Management
Services charges Advanced Materials $5,000 less in rent each year. Advanced
Materials is a first-time filer of annual surveys. Advanced Materials must file
its annual survey with the department covering the 2014 calendar year by April
30, 2015. Surveys are due from Advanced Materials by April 30th for 2016 and by
May 31st for 2017, with annual tax performance reports due in 2018 through May
31, 2022.
(j)
Example
4. Fruit Canning, Inc. claims the B&O tax exemption provided in
RCW
82.04.4266 for the canning of fruit in 2015.
Fruit Canning is a first-time filer of annual surveys. Fruit Canning must file
an annual survey with the department by April 30, 2016, covering calendar years
2014 and 2015. If Fruit Canning claims the B&O tax exemption during
subsequent years, it must file an annual survey by May 31st in 2017 and 2018,
and an annual tax performance report by May 31st in 2019 and each subsequent
year.
(4)
What
information does the annual survey require? The annual survey requires
the following:
(a) Amount of tax deferred,
the amount of B&O tax exempted, the amount of B&O tax credit taken, or
the amount of B&O tax reduced under the preferential rate;
(b) For taxpayers claiming the tax deferral
under chapter 82.60 or 82.63 RCW:
(i) The
number of new products or research projects by general classification;
and
(ii) The number of trademarks,
patents, and copyrights associated with activities at the investment
project;
(c) For
taxpayers claiming the B&O tax credit under
RCW
82.04.4452:
(i) The qualified research and development
expenditures during the calendar year for which the credit was
claimed;
(ii) The taxable amount
during the calendar year for which the credit was claimed;
(iii) The number of new products or research
projects by general classification;
(iv) The number of trademarks, patents, and
copyrights associated with the research and development activities for which
the credit was claimed; and
(v)
Whether the credit has been assigned and who assigned the credit.
The credit provided under
RCW
82.04.4452 expired January 1,
2015.
(d) The
following information for employment positions in Washington state:
(i) The total number of employment
positions;
(ii) Full-time,
part-time, and temporary employment positions as a percent of total employment.
Refer to subsection (7) of this rule for information about full-time,
part-time, and temporary employment positions;
(iii) The number of employment positions
according to the wage bands of less than $30,000; $30,000 or greater, but less
than $60,000; and $60,000 or greater. A wage band containing fewer than three
individuals may be combined with the next lowest wage band; and
(iv) The number of employment positions that
have employer-provided medical, dental, and retirement benefits, by each of the
wage bands; and
(e)
Additional information the department requests that is necessary to measure the
results of, or determine eligibility for the tax preferences.
(i) Prior to its repeal effective January 1,
2018, RCW
82.32.585 requires the department to report
to the legislature summary descriptive statistics by category and the
effectiveness of certain tax preferences, such as job creation, company growth,
and such other factors as the department selects or as the statutes identify.
The department has included questions related to measuring these
effects.
(ii) In addition, the
department has included questions related to:
(A) The taxpayer's use of the sales and use
tax exemption for machinery and equipment used in manufacturing provided in
RCW
82.08.025651 and
82.12.025651; and
(B) The Unified Business Identifier used with
the Washington state employment security department and all employment security
department reference numbers used on quarterly tax reports that cover the
employment positions reported in the annual survey.
(5)
What is total
employment in the annual survey?
(a)
Employment as of December 31st. The annual survey requires
information on all full-time, part-time, and temporary employment positions
located in Washington state on December 31st of the calendar year covered by
the survey. Total employment includes persons who are on leaves of absence such
as sick leave, vacation, disability leave, jury duty, military leave, and
workers compensation leave, regardless of whether those persons are receiving
wages. Total employment does not include separations from employment such as
layoffs and reductions in force. Vacant positions are not included in total
employment.
(b)
The following
facts apply to the examples in (b)(i) through (iv) of this subsection.
National Construction Equipment (NCE) manufactures bulldozers, cranes, and
other earth-moving equipment in Ridgefield and Kennewick, WA. NCE received a
deferral of taxes under chapter 82.60 RCW for sales and use taxes on its new
manufacturing site in Kennewick.
(i)
Example 5. NCE employs 200 workers in Ridge-field manufacturing
construction cranes. NCE employs 250 workers in Kennewick manufacturing
bulldozers and other earth-moving equipment. Although NCE's facility in
Ridgefield does not qualify for any tax preferences, NCE's annual survey must
report a total of 450 employment positions. The annual survey includes all
Washington state employment positions, which includes employment positions
engaged in activities that do not qualify for tax preferences.
(ii)
Example 6. On November
20th, NCE lays off 75 workers. NCE notifies 10 of the laid off workers on
December 20th that they will be rehired and begin work on January 2nd. The 75
employment positions are excluded from NCE's annual survey, because a
separation of employment has occurred. Although NCE intends to rehire 10
employees, those employment positions are vacant on December 31st.
(iii)
Example 7. On December
31st, NCE has 100 employees on vacation leave, five employees on sick leave,
two employees on military leave, one employee who is scheduled to retire as of
January 1st, and three vacant employment positions. The employment positions of
employees on vacation, sick leave, and military leave must be included in NCE's
annual survey. The one employee scheduled to retire must be included in the
annual survey because the employment position is filled on December 31st. The
three vacant positions are not included in the annual survey.
(iv)
Example 8. In June, NCE
hires two employees from a local college to intern in its engineering
department. When the academic year begins in September, one employee ends the
internship. The other employee's internship continues until the following June.
NCE must report one employment position on the annual survey, representing the
intern employed on December 31st.
(6)
When is an employment position
located in Washington state? The annual survey seeks information only
about Washington employment positions. An employment position is located in
Washington state if:
(a) The service of the
employee is performed entirely within the state;
(b) The service of the employee is performed
both within and without the state, but the service performed without the state
is incidental to the employee's service within the state;
(c) The service of the employee is performed
both within and without the state, and the employee's base of operations is
within the state;
(d) The service
of the employee is performed both within and without the state, but the service
is directed or controlled in this state; or
(e) The service of the employee is performed
both within and without the state and the service is not directed or controlled
in this state, but the employee's individual residence is in this
state.
(f)
The following
facts apply to the examples in (f)(i) through (iv) of this subsection.
Acme Computer, Inc. develops computer software and receives a deferral of taxes
under chapter 82.60 RCW for sales and use taxes on an eligible investment
project in a high unemployment county. Acme Computer, headquartered in
California, has employees working at four locations in Washington state. Acme
Computer also has offices in Oregon and Texas.
(i)
Example 9. Ed is a software
engineer in Acme Computer's Vancouver office. Ed occasionally works at Acme
Computer's Portland, Oregon office when other software engineers are on leave.
Ed's position must be included in the number of total employment positions in
Washington state that Acme Computer reports on the annual survey. Ed performs
services both within and without the state, but the services performed without
the state are incidental to the employee services within the state.
(ii)
Example 10. John is an Acme
Computer salesperson. John travels throughout Washington, Oregon, and Idaho
promoting sales of new Acme Computer products. John's activities are directed
by his manager in Acme Computer's Spokane office. John's position must be
included in the number of total employment positions in Washington state that
Acme Computer reports on the annual survey. John performs services both within
and without the state, but the services are directed or controlled in
Washington state.
(iii)
Example 11. Jane, vice president for product development, works in
Acme Computer's Portland, Oregon office. Jane regularly travels to Seattle to
review the progress of research and development projects conducted in
Washington state. Jane's position should not be included in the number of total
employment positions in Washington state that Acme Computer reports on the
annual survey. Although Jane regularly performs services within Washington
state, her activities are directed or controlled in Oregon.
(iv)
Example 12. Roberta, a
service technician, travels throughout the United States servicing Acme
Computer products. Her activities are directed from Acme Computer's corporate
offices in California, but she works from her home office in Tacoma. Roberta's
position must be included in the number of total employment positions in
Washington state that Acme Computer reports on the annual survey. Although
Roberta performs services both within and without the state and the service is
not directed or controlled in this state, her residence is in Washington
state.
(7)
What are full-time, part-time, and temporary employment positions?
The survey must separately identify the number of full-time, part-time, and
temporary employment positions as a percent of total employment.
(a)
Full-time and part-time employment
positions. A position is considered full-time or part-time if the
employer intends for the position to be filled for at least 52 consecutive
weeks or 12 consecutive months, excluding any leaves of absence.
(i)
Full-time positions. A
full-time position is a position that requires the employee to work, excluding
overtime hours, 35 hours per week for 52 consecutive weeks, 455 hours a quarter
for four consecutive quarters, or 1,820 hours during a period of 12 consecutive
months.
(ii)
Part-time
positions. A part-time position is a position in which the employee may
work less than the hours required for a fulltime position.
(iii)
Exceptions for full-time
positions. In some instances, an employee may not be required to work
the hours required for full-time employment because of paid rest and meal
breaks, health and safety laws, disability laws, shift differentials, or
collective bargaining agreements. If, in the absence of these factors, the
employee would be required to work the number of hours for a full-time position
to receive their current wage, the position must be reported as a full-time
employment position.
(b)
Temporary positions. There are two types of temporary positions.
(i)
Employees of the person required to
complete the survey. In the case of a temporary employee directly
employed by the person required to complete the survey, a temporary position is
a position intended to be filled for a period of less than 52 consecutive weeks
or 12 consecutive months. For example, seasonal employment positions are
temporary positions. These temporary positions must be included in the
information required in subsections (5), (8), and (9) of this rule.
(ii)
Workers furnished by staffing
companies. A temporary position also includes a position filled by a
worker furnished by a staffing company, regardless of the duration of the
placement. These temporary positions must be included in the information
required in subsections (5), (8), and (9) of this rule. In addition, the person
filling out the annual survey must provide the following additional
information:
(A) Total number of staffing
company employees furnished by staffing companies;
(B) Top three occupational codes of all
staffing company employees; and
(C)
Average duration of all staffing company employees.
(c)
The following facts
apply to the examples in (c)(i) through (vi) of this subsection.
Worldwide Materials, Inc. is a developer of materials used in manufacturing
electronic devices. Worldwide Materials receives a deferral of taxes under
chapter 82.60 RCW for sales and use taxes on an eligible investment project in
a high unemployment county. Worldwide Materials has 100 employees.
(i)
Example 13. On December
31st, Worldwide Materials has five employees on workers' compensation leave. At
the time of the work-related injuries, the employees worked 40 hours a week and
were expected to work for 52 consecutive weeks. Worldwide Materials must report
these employees as being employed in a full-time position. Although the five
employees are not currently working, they are on workers' compensation leave
and Worldwide Materials had intended for the full-time positions to be filled
for at least 52 consecutive weeks.
(ii)
Example 14. In September,
Worldwide Materials hires two employees on a full-time basis for a two-year
project to design composite materials to be used in a new airplane model.
Because the position is intended to be filled for a period exceeding 12
consecutive months, Worldwide Materials must report these positions as
full-time positions.
(iii)
Example 15. Worldwide Materials has two employees who clean
laboratories during the evenings. The employees regularly work 5:00 p.m. to
11:00 p.m., Monday through Friday, 52 weeks a year. Because the employees work
less than 35 hours a week, the employment positions are reported as part-time
positions.
(iv)
Example
16. On November 1st, a Worldwide Materials engineer begins 12 weeks of
family and medical leave. The engineer was expected to work 40 hours a week for
52 consecutive weeks. While the engineer is on leave, Worldwide Materials hires
a staffing company to furnish a worker to complete the engineer's projects.
Worldwide Materials must report the engineer as a full-time position on the
annual survey. Worldwide Materials must also report the worker furnished by the
staffing company as a temporary employment position and include the information
as required in (b) of this subsection.
(v)
Example 17. Worldwide
Materials allows three of its research employees to work on specific projects
with a flexible schedule. These employees are not required to work a set amount
of hours each week, but are expected to work 12 consecutive months. The three
research employees are paid a comparable wage as other research employees who
are required to work a set schedule of 40 hours a week. Although the three
research employees may work fewer hours, they are receiving comparable wages as
other research employees working 40 hours a week. Worldwide Materials must
report these positions as full-time employment positions, because each position
is equivalent to a full-time employment position.
(vi)
Example 18. Worldwide
Materials has a large order to fulfill and hires 10 employees for the months of
June and July. Five of the employees leave at the end of July. Worldwide
Materials decides to have the remaining five employees work on an on-call basis
for the remainder of the year. As of December 31st, three of the employees are
working for Worldwide Materials on an on-call basis. Worldwide Materials must
report three temporary employment positions on the annual survey and include
these positions in the information required in subsections (5), (8), and (9) of
this rule.
(8)
What are wages? For the purposes of the annual survey, "wages"
means compensation paid to an individual for personal services, whether
denominated as wages, salary, commission, or otherwise as reported on the W-2
forms of employees. Stock options granted as compensation to employees are
wages to the extent they are reported on the W-2 forms of the employees and are
taken as a deduction for federal income tax purposes by the employer. The
compensation of a proprietor or a partner is determined in one of two ways:
(a) If there is net income for federal income
tax purposes, the amount reported subject to self-employment tax is the
compensation.
(b) If there is no
net income for federal income tax purposes, reasonable cash withdrawals or cash
advances is the compensation.
(9)
What are employer-provided
benefits? The annual survey requires persons to report the number of
employees that have employer-provided medical, dental, and retirement benefits,
by each of the wage bands. An employee has employer-provided medical, dental,
and retirement benefits if the employee is currently eligible to participate or
receive the benefit. A benefit is "employer-provided" if the medical, dental,
and retirement benefit is dependent on the employer's establishment or
administration of the benefit. A benefit that is equally available to employees
and the general public is not an "employer-provided" benefit.
(a)
What are medical benefits?
"Medical benefits" means compensation, not paid as wages, in the form of a
health plan offered by an employer to its employees. A "health plan" means any
plan, fund, or program established, maintained, or funded by an employer for
the purpose of providing for its employees or their beneficiaries, through the
purchase of insurance or otherwise, medical and/or dental care services.
(i) Health plans include any:
(A) "Employee welfare benefit plan" as
defined by the Employee Retirement Income Security Act (ERISA);
(B) "Health plan" or "health benefit plan" as
defined in
RCW
48.43.005;
(C) Self-funded multiple employer welfare
arrangement as defined in
RCW
48.125.010;
(D) "Qualified health insurance" as defined
in Section 35 of the Internal Revenue Code;
(E) "Archer MSA" as defined in Section 220 of
the Internal Revenue Code;
(F)
"Health savings plan" as defined in Section 223 of the Internal Revenue
Code;
(G) "Health plan" qualifying
under Section 213 of the Internal Revenue Code;
(H) Governmental plans; and
(I) Church plans.
(ii) "Health care services" means services
offered or provided by health care facilities and health care providers
relating to the prevention, cure, or treatment of illness, injury, or
disease.
(b)
What
are dental benefits? "Dental benefits" means a dental health plan
offered by an employer as a benefit to its employees. "Dental health plan" has
the same meaning as "health plan" in (a) of this subsection, but is for the
purpose of providing for employees or their beneficiaries, through the purchase
of insurance or otherwise, dental care services. "Dental care services" means
services offered or provided by health care facilities and health care
providers relating to the prevention, cure, or treatment of illness, injury, or
disease of human teeth, alveolar process, gums, or jaw.
(c)
What are retirement
benefits? "Retirement benefits" means compensation, not paid as wages,
in the form of a retirement plan offered by an employer to its employees. An
employer contribution to the retirement plan is not required for a retirement
plan to be employer-provided. A "retirement plan" means any plan, account,
deposit, annuity, or benefit, other than a life insurance policy, that provides
for retirement income or deferred income to employees for periods after
employment is terminated. The term includes pensions, annuities, stock bonus
plans, employee stock ownership plans, profit sharing plans, self-employed
retirement plans, individual retirement accounts, individual retirement
annuities, and retirement bonds, as well as any other plan or program, without
regard to its source of funding, and without regard to whether the retirement
plan is a qualified plan meeting the guidelines established in the Employee
Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue
Code.
(d)
The following facts
apply to the examples in (d)(i) through (v) of this subsection. Medical
Resource, Inc. is a pharmaceutical manufacturer that receives a deferral of
taxes under chapter 82.60 RCW for sales and use taxes on an eligible investment
project in a high unemployment county. It employs 200 full-time employees and
50 part-time employees. Medical Resource also hires a staffing company to
furnish 75 workers.
(i)
Example
19. Medical Resource offers its employees two different health plans as
a medical benefit. Plan A is available at no cost to full-time employees.
Employees are not eligible to participate in Plan A until completing 30 days of
employment. Plan B costs employees $200 each month. Full-time and part-time
employees are eligible for Plan B after six months of employment. One hundred
full-time employees are enrolled in Plan A. One hundred full-time and part-time
employees are enrolled in Plan B. Forty full-time and part-time employees chose
not to enroll in either plan. Ten part-time employees are not yet eligible for
either Plan A or Plan B. Medical Resource must report 200 employees as having
employer-provided medical benefits, because that is the number of employees
enrolled in the health plans it offers.
(ii)
Example 20. Medical
Resource does not offer medical benefits to the employees of the staffing
company. However, 25 of these workers have enrolled in a health plan through
the staffing company. Medical Resource must report these 25 employment
positions as having employer-provided medical benefits.
(iii)
Example 21. Medical
Resource does not offer its employees dental insurance, but has arranged with a
group of dental providers to provide all employees with a 30% discount on any
dental care service. Medical Resource employment is the sole requirement to
receive this benefit. Unlike the medical benefit, employees are eligible for
the dental benefit as of the first day of employment. This benefit is not
provided to the workers furnished by the staffing company. Medical Resource
must report 250 employment positions as having dental benefits, because that is
the number of employees enrolled in this dental plan.
(iv)
Example 22. Medical
Resource offers a 401(k) Plan to its full-time and part-time employees after
six months of employment. Medical Resource makes matching contributions to an
employee's 401(k) Plan after two years of employment. On December 31st, 225
workers are eligible to participate in the 401(k) Plan. Two hundred workers are
enrolled in the 401(k) Plan. One hundred of these workers receive matching
contributions. Medical Resource must report 200 employment positions as having
employer-provided retirement benefits, because that is the number of employees
enrolled in the 401(k) Plan.
(v)
Example 23. Medical Resource coordinates with a bank to insert
information in employee paycheck envelopes on the bank's Individual Retirement
Account (IRA) options offered to bank customers. Employees who open an IRA with
the bank can arrange to have their contributions directly deposited from their
paychecks into their accounts. Fifty employees open IRAs with the bank. Medical
Resource cannot report that these 50 employees have employer-provided
retirement benefits. IRAs are not an employer-provided benefit because the
ability to establish the IRA is not dependent on Medical Resource's
participation or sponsorship of the benefit.
(10)
Is the annual survey
confidential? The annual survey is subject to the confidentiality
provisions of
RCW
82.32.330. However, information on the amount
of tax preference taken is not subject to the confidentiality provisions of
RCW
82.32.330 and may be disclosed to the public,
except as provided in (c) of this subsection.
(a)
Failure to timely file a complete
annual survey subject to disclosure. If a taxpayer fails to timely file
a complete annual survey, then the amount required to be repaid as a result of
the taxpayer's failure to file a complete annual survey is not confidential and
may be disclosed to the public.
(b)
Amount reported in annual survey is different from the amount claimed or
allowed. If a taxpayer reports a tax preference amount on the annual
survey that is different than the amount actually claimed on the taxpayer's tax
returns or otherwise allowed by the department, then the amount actually
claimed or allowed may be disclosed.
(c)
Tax preference is less than
$10,000. If the tax preference is less than $10,000 during the period
covered by the annual survey, the taxpayer may request that the department
treat the amount of the tax preference as confidential under
RCW
82.32.330.
(11)
What are the consequences for
failing to timely file a complete annual survey?
(a)
What is a "complete annual
survey"? An annual survey is complete if:
(i) The annual survey is filed on the form
required by this rule or in an electronic format as required by law;
and
(ii) The person makes a good
faith effort to substantially respond to all survey questions required by this
rule.
Responses such as "varied," "various," or "please contact for
information" are not considered good faith responses to a question.
(b)
Amounts due
for late filing. Unless the tax preference is a deferral of tax, as
described in (c) of this subsection, or as otherwise provided by law, if a
person claims a tax preference that requires an annual survey under this rule,
but fails to submit a complete survey by the due dates described in subsection
(3)(e) of this rule, or any extension under
RCW
82.32.590, the following amounts are
immediately due and payable:
(i) For surveys
due prior to July 1, 2017, 100 percent of the amount of the tax preference
claimed for the previous calendar year. Interest, but not penalties, will be
assessed on the amounts due at the rate provided for under
RCW
82.32.050, retroactively to the date the tax
preference was claimed, and accruing until the taxes for which the tax
preference was claimed are repaid.
(ii) For surveys due on or after July 1,
2017:
(A) Thirty-five percent of the amount of
the tax preference claimed for the previous calendar year; and
(B) An additional 15 percent of the amount of
the tax preference claimed for the previous calendar year if the person has
previously been assessed under (b)(ii) of this subsection for failure to timely
submit a survey for the same tax preference.
(c)
Tax deferrals. If the tax
preference is a deferral of tax, 12.5 percent of the deferred tax is
immediately due. If the economic benefits of the deferral are passed to a
lessee, the lessee is responsible for payment to the extent the lessee has
received the economic benefit.
(d)
Interest and penalties. The department may not assess interest or
penalties on amounts due under (b)(ii) and (c) of this subsection.
(e)
Extension for circumstances beyond
the control of the taxpayer. If the department finds the failure of a
taxpayer to file an annual survey by the due date was the result of
circumstances beyond the control of the taxpayer, the department will extend
the time for filing the survey. The extension will be for a period of 30 days
from the date the department issues its written notification to the taxpayer
that it qualifies for an extension under this rule. The department may grant
additional extensions as it deems proper under
RCW
82.32.590.
In determining whether the failure of a taxpayer to file an
annual survey by the due date was the result of circumstances beyond the
control of the taxpayer, the department will apply the provisions in WAC
458-20-228 for the waiver or
cancellation of penalties when the underpayment or untimely payment of any tax
was due to circumstances beyond the control of the taxpayer.
(f)
One-time only extension. A
taxpayer who fails to file an annual survey, as required under this rule, by
the due date of the survey is entitled to an extension of the due date. A
request for an extension under this subsection must be made in writing to the
department.
(i) To qualify for an extension,
a taxpayer must have filed all annual reports and surveys, if any, due in prior
years by their respective due dates, beginning with annual reports and surveys
due in the calendar year 2010.
(ii)
The extension is for 90 days from the original due date of the annual
survey.
(iii) No taxpayer may be
granted more than one 90-day extension.
Statutory Authority:
RCW
82.32.300 and
82.01.060(2).
10-22-087, § 458-20-268, filed 11/1/10, effective 12/2/10; 10-10-038,
§ 458-20-268, filed 4/27/10, effective 5/28/10; 07-02-074, §
458-20-268, filed 12/29/06, effective
1/29/07.