RCW 82.08.037
Credits and refunds for bad debts. (Effective until July 1, 2008.)

(1) A seller is entitled to a credit or refund for sales taxes previously paid on bad debts, as that term is used in 26 U.S.C. Sec. 166, as amended or renumbered as of January 1, 2003.

     (2) For purposes of this section, "bad debts" does not include:

     (a) Amounts due on property that remains in the possession of the seller until the full purchase price is paid;

     (b) Expenses incurred in attempting to collect debt; and

     (c) Repossessed property.

     (3) If a credit or refund of sales tax is taken for a bad debt and the debt is subsequently collected in whole or in part, the tax on the amount collected must be paid and reported on the return filed for the period in which the collection is made.

     (4) Payments on a previously claimed bad debt are applied first proportionally to the taxable price of the property or service and the sales or use tax thereon, and secondly to interest, service charges, and any other charges.

     (5) If the seller uses a certified service provider as defined in RCW 82.58.010 to administer its sales tax responsibilities, the certified service provider may claim, on behalf of the seller, the credit or refund allowed by this section. The certified service provider must credit or refund the full amount received to the seller.

     (6) The department shall allow an allocation of bad debts among member states to the streamlined sales tax agreement, as defined in RCW 82.58.010(1), if the books and records of the person claiming bad debts support the allocation.

[2004 c 153 § 302; 2003 c 168 § 212; 1982 1st ex.s. c 35 § 35.]

NOTES:

     Bad debts -- Intent -- 2004 c 153 §§ 302-305: "For the purposes of sections 302 through 305 of this act, the legislature does not intend by any provision of this act relating to bad debts, and did not intend by any provision of chapter 168, Laws of 2003 relating to bad debts, to affect the holding of the supreme court of the state of Washington in Puget Sound National Bank v. the Department of Revenue, 123 Wn. 2nd 284 (1994)." [2004 c 153 § 301.]

     Retroactive effective date -- Effective date -- 2004 c 153: See note following RCW 82.08.0293.

     Effective dates -- Part headings not law -- 2003 c 168: See notes following RCW 82.08.010.

     Severability -- Effective dates -- 1982 1st ex.s. c 35: See notes following RCW 82.08.020.

     RCW 82.08.037
Credits and refunds for bad debts. (Effective July 1, 2008.)

(1) A seller is entitled to a credit or refund for sales taxes previously paid on bad debts, as that term is used in 26 U.S.C. Sec. 166, as amended or renumbered as of January 1, 2003.

     (2) For purposes of this section, "bad debts" does not include:

     (a) Amounts due on property that remains in the possession of the seller until the full purchase price is paid;

     (b) Expenses incurred in attempting to collect debt; and

     (c) Repossessed property.

     (3) If a credit or refund of sales tax is taken for a bad debt and the debt is subsequently collected in whole or in part, the tax on the amount collected must be paid and reported on the return filed for the period in which the collection is made.

     (4) Payments on a previously claimed bad debt are applied first proportionally to the taxable price of the property or service and the sales or use tax thereon, and secondly to interest, service charges, and any other charges.

     (5) If the seller uses a certified service provider as defined in RCW 82.32.020 to administer its sales tax responsibilities, the certified service provider may claim, on behalf of the seller, the credit or refund allowed by this section. The certified service provider must credit or refund the full amount received to the seller.

     (6) The department shall allow an allocation of bad debts among member states to the streamlined sales tax agreement, as defined in RCW 82.58.010(1), if the books and records of the person claiming bad debts support the allocation.

[2007 c 6 § 102; 2004 c 153 § 302; 2003 c 168 § 212; 1982 1st ex.s. c 35 § 35.]

NOTES:

     Part headings not law -- Savings -- Effective date -- Severability -- 2007 c 6: See notes following RCW 82.32.020.

     Findings -- Intent -- 2007 c 6: See note following RCW 82.14.495.

     Bad debts -- Intent -- 2004 c 153 §§ 302-305: "For the purposes of sections 302 through 305 of this act, the legislature does not intend by any provision of this act relating to bad debts, and did not intend by any provision of chapter 168, Laws of 2003 relating to bad debts, to affect the holding of the supreme court of the state of Washington in Puget Sound National Bank v. the Department of Revenue, 123 Wn. 2nd 284 (1994)." [2004 c 153 § 301.]

     Retroactive effective date -- Effective date -- 2004 c 153: See note following RCW 82.08.0293.

     Effective dates -- Part headings not law -- 2003 c 168: See notes following RCW 82.08.010.

     Severability -- Effective dates -- 1982 1st ex.s. c 35: See notes following RCW 82.08.020.