Coronavirus Relief Payments Are Not Subject to Washington State Tax – Tax


United States: Coronavirus relief payments are not subject to Washington state tax

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Since our initial Washington State legal update regarding companies receiving financial relief under the CARES Act, including but not limited to the Federal Paycheck Protection Program (PPP ), the Washington Legislature acted and successfully passed legislation to provide taxpayers with some relief during the ongoing pandemic. Effective February 19, 2021 and applied retroactively to February 29, 2020, Substitute Bill 1095 creates three new tax exemption laws, including:

RCW 82.04.767 (Professional and professional tax);

RCW 82.08.0209 (retail sales tax); and

BRF 82.16.320 (Tax on utilities).

The three new laws provide that related Washington taxes do not apply to amounts received as qualifying grant (received on or after February 29, 2020). Eligible subsidy is a term defined by law. The Department of Revenue summarized the “eligible subsidy” in a article to mean “government-funded financial assistance provided to address the impacts of conditions giving rise to a national emergency or state of emergency, including the COVID-19 pandemic”.

At the time of our previous publication, the Washington Department of Revenue was deferring its decision until it takes a closer look at the various tax programs and laws. She expected her postponement to provide an opportunity for lawmakers to “clarify the applicable laws.” Fortunately, his delay worked, and the legislature was able to act to help taxpayers doing business in Washington state. To learn more about how we got here, visit our previous article here.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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