South Dakota v. Wayfair Update: Washington

A statement on the Washington State Department of Revenue website announces that the department is aware of the Supreme Court’s decision to overturn Quill Corp v. North Dakota and will consider its implications to determine next steps.

Prior to the Wayfair ruling, Washington had already made similar updates to sales and use tax requirements for out-of-state sellers. Beginning on January 1, 2018, the state introduced new sales and use tax obligations for marketplace facilitators, remote sellers and referrers. Out-of-state retailers making $10,000 or more in retail sales from consumers in Washington are required to collect and remit sales and use tax or provide a “conspicuous notice” at the time of the sales that use tax may be due on the purchase.

Details are available on the Department of Revenue’s website.

Update: On August 3, 2018, the Washington Department of Revenue issued guidance for out-of-state vendors.  

Effective January 1, 2018, remote sellers and marketplace facilitators with more than $10,000 in retail sales into Washington must either register and collect sales tax on all taxable sales or follow the use tax notice and reporting requirements.

Effective October 1, 2018, remote sellers and marketplace facilitators are required to collect and remit sales tax on all taxable retail sales into Washington if the seller meets either or both of the following conditions in the previous calendar year or the current calendar year:  

  • it has gross revenue from sales exceeding $100,000; or
  • it has 200 or more separate transactions into Washington.

As of October 1, 2018, once a business exceeds the $100,000 in retail sales or 200 transactions threshold, the business no longer has a choice and must register and collect retail sales/use tax.

New Sales Tax Landscape for Online Sellers

The recent U.S. Supreme Court ruling in South Dakota v. Wayfair overturning the long-held Quill decision will dramatically change the landscape for online sellers when it comes to sales tax.

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