Trailing Nexus in Washington State

Any person or business with substantial nexus (connection) with the state of Washington is required to collect and remit Washington business and occupation (B&O) tax and sales and use tax. Effective June 1, 2010, anyone having substantial nexus in any tax year is considered to have substantial nexus for the following tax year. This is known as trailing nexus.

The Washington State Department of Revenue clarifies that nexus continues for the remainder of the calendar year and the following calendar year when one of the following nexus standards is met:

• “For businesses engaged in apportionable activities (WAC 458-20-19401(2)(a)) or sales subject to wholesaling B&O tax under RCW 82.04.257 or RCW 82.04.270, the minimum nexus thresholds of RCW 82.04.067(1-5) apply. Ÿ

• For other business activities, nexus is based on the business having a physical presence in Washington (RCW 82.04.067(6)).”

Additional information is available in this Special Notice and the above links.

Businesses with nexus in multiple states can simply compliance by implementing an automated solution. Learn more.