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The Washington Court of Appeals held that, for purposes of the Business and Occupation (B&O) Tax, a law firm’s gross income from insurance litigation services were properly sourced to the state where litigation occurred. A law firm with offices in Washington and Oregon that provides insurance defense litigation sought a refund of B&O Tax on…

The Washington Court of Appeals held that a Washington-based consulting firm was not entitled to a refund of Washington Business and Occupation (B&O) Tax because the taxpayer failed to show that the benefit of services provided to its client were received outside of Washington.

The taxpayer provided technology information services to a number of software…

In Guild Mortgage Company v. Washington Department of Revenue, the Washington Board of Tax Appeals considered whether certain fees associated with mortgage sales – guaranty fees, loan-level price adjustments (LLPAs), and lender credits – should be included in the taxpayer’s gross income for purposes of the state’s business and occupation (B&O) tax. 

The taxpayer…

The Washington Board of Tax Appeals upheld the Department’s determination that certain fees and credits related to mortgage sales to government-sponsored enterprises are included in the lender’s gross income for B&O tax purposes. Specifically, the Board concluded that guaranty fees and loan-level price adjustment fees are part of the lender’s cost of doing business and…

On May 20, 2025, the last day for bill signing, Washington Governor Ferguson signed two key tax bills that expand the sales tax to include additional services and increase the rates of the (awful) business and occupation (B&O) tax. Some of these increases are targeted at certain industries and will incite litigation. A projected budget…

A content delivery network (CDN) services provider appealed the Department’s assessment of retail sales tax in which the Department determined that the taxpayer’s CDN services were “digital automated services” subject to the retailing B&O tax and retail sales tax. The taxpayer disagreed, noting that its CDN is a “backbone” component of the internet that its…

The Washington Department of Revenue issued proposed guidance limiting the application of the multiple points of use (MPU) sales tax exemption for bundled software maintenance agreements.

The MPU exemption provides a retail sales tax exemption for the purchase of digital goods, prewritten computer software, remotely accessed prewritten computer software, digital automated services, and digital codes…

On November 5, voters cast their ballots to determine who would fill a variety of federal, state, and local offices. Several states also considered tax related ballot initiatives. We describe some of the more significant ballot initiatives and their results.

Sales Tax

There were a few states with ballot initiatives that would exempt items from…

The Washington Court of Appeals recently upheld the dismissal of a putative class action brought against four grocery store chains that collected sales tax on sales of 100 percent juice beverages. A taxpayer alleged that the grocers violated Washington’s Retail Sales Tax Act and Consumer Protection Act by wrongfully collecting sales tax on the exempt…

The Washington Court of Appeals held that the sales of pre-paid telephone airtime purchased from third-party cellular networks by a business (Taxpayer) and resold to individual customers and retailers were subject to the City of Renton’s municipal utility tax.

The utility tax was imposed on the privilege of conducting a “telephone business” within city limits…