Each year, the Washington State Department of Revenue (DOR) requires taxpayers that participated in at least one of the state’s tax incentive programs to file a survey or report regarding their use. These filings are due by May 31 following the year in which the incentive, credit, or reduced tax rate was claimed.
Businesses must electronically file a separate survey or report for each tax reporting account in Washington through the state’s e-filing system. Failure to file a completed survey or report by the May 31 deadline could result in a partial loss of the applicable incentive, credit, or reduced tax rate.
Annual Survey—Required Filers
Participation in the following programs requires taxpayers to file a tax incentive survey with the DOR:
- Fruit and vegetable processors’ business and occupation (B&O) tax exemption
- Dairy and seafood products B&O tax exemption
- Sales and use tax deferral or waiver on construction of cold storage and certain food manufacturing or processing facilities
- Biotechnology and medical device manufacturing sales and use tax deferral or waiver
- Reduced B&O tax rate for timber extraction and manufacturing
- Sales and use tax deferral or waiver for locating corporate headquarters in a community empowerment zone
- Sales and use tax deferral for manufacturing facilities in counties with high unemployment
- Customized employment training tax credit
Annual Report—Required Filers
Participation in the following programs requires taxpayers to file an annual report with the DOR:
Aerospace
- B&O tax credit for aerospace product development expenditures
- Reduced B&O tax rate for aerospace businesses
- B&O tax credit for property and leasehold taxes paid on aerospace manufacturing facilities
Aluminum Smelting
- Reduced B&O tax for aluminum smelting
- B&O tax credit to offset the state portion of sales tax on materials used in aluminum smelting
- B&O tax credit to offset property tax for aluminum smelters
- Use tax exemption on brokered natural gas
Semiconductor Manufacturing
- Reduced B&O tax rate for manufacturers of semiconductor materials
- Sales and use tax exemption for purchases of semiconductor gases and chemicals
Miscellaneous
- Public utility tax exemption on power for electrolyte processing
- Reduced B&O tax rate for newspaper publishers
- Reduced B&O tax rate for manufacturers of solar energy systems and their components
- Sales and use tax exemption for purchases of server equipment and power infrastructure for use in eligible data centers
Penalties
Effective July 1, 2017, the penalty for failure to file the report or survey on time is 35% of the incentive claimed—a reduction from the previous 100% penalty.
Extensions and Other Details
Requesting an Extension
Taxpayers that are unable to file the survey or report by May 31 can request an extension by contacting the DOR prior to the due date at (360) 570-3265. On its voicemail menu, press six, then two.
Electronic Filing
Nearly all forms must be filed electronically using the DOR’s e-filing services, including those for the following:
- High tech
- Biotechnology
- Aerospace
- Fruit and vegetable processors
- Seafood
- Timber
- Dairy
- Customized employment
- Cold storage
First-Year Filings
Many first-year filings for incentives must include surveys for both the 2016 and 2017 periods.
We're Here to Help
Filing your survey or report in a timely manner is critical to maintaining the credit or incentive your business may depend on. If you have any questions about filling out the forms or would like to discuss how you can leverage additional Washington State tax credits and incentives, contact your Moss Adams professional or email statetax@mossadams.com.