(1)
Introduction. This rule provides information about reseller
permits issued by the department of revenue (department). The department issues
reseller permits to businesses that make wholesale purchases, such as
retailers, wholesalers, manufacturers, and qualified contractors. The permits
allow the businesses to purchase certain items or services without paying
retail sales tax.
(a)
Other rules that
may apply. Readers may want to refer to other rules for additional
information, including those in the following list:
(i) WAC
458-20-101 (Tax registration and
tax reporting) for information on who is required to register and file
returns;
(ii) WAC
458-20-10201 (Application process
and eligibility requirements for reseller permits) for information about the
application process and eligibility requirements for obtaining a reseller
permit;
(iii) WAC
458-20-10202 (Brief adjudicative
proceedings for matters related to reseller permits) for information about the
procedures for appealing the denial of an application for a reseller
permit;
(iv) WAC
458-20-102A (Resale certificates)
for information about resale certificate documentation requirements for
wholesale sales occurring before January 1, 2010; and
(v) WAC
458-20-192 (Indian-Indian
country) for information on the extent of the state's authority to regulate and
impose tax in Indian country.
(b)
Examples. Examples found in
this rule identify a number of facts and then state a conclusion. These
examples should be used only as a general guide. The tax results of other
situations must be determined after a review of all the facts and
circumstances.
(2)
What is a reseller permit? A reseller permit is a document issued
to a business by the department that the business provides to a seller to
substantiate a wholesale purchase. Each reseller permit contains a unique
identifying number. Businesses should keep the original permit and make and
distribute copies of the permit to sellers from whom they make wholesale
purchases as described in subsection (6) of this rule. Sellers may store copies
of reseller permits in either paper or electronic format.
The reseller permit document issued by the department contains
an optional, blank "Notes" section in which the permit holder may provide
additional information, such as a description of the items or services the
permit holder wishes to purchase at wholesale.
(3)
Who may use a reseller
permit? The buyer may authorize any person in its employ to use a copy
of the buyer's reseller permit on the buyer's behalf. However, misuse of the
reseller permit subjects the buyer to:
* Revocation of the reseller permit;
* Penalties as provided in
RCW
82.32.290 and 82.32.-291; and
* Tax, interest, and any other penalties imposed by law.
The buyer is responsible for educating all persons authorized
to use the reseller permit on the proper use of the buyer's reseller
permit.
(4)
How long
is a reseller permit effective? Except as otherwise provided in this
subsection, a reseller permit is generally valid for a period of forty-eight
months from the date of issuance, renewal, or reinstatement.
(a)
Conditions when permit is effective
for twenty-four months. A reseller permit is valid for an initial period
of twenty-four months and may be renewed for a period of forty-eight months, if
the permit is issued to a taxpayer who:
(i) Is
not required to be registered with the department under
RCW
82.32.030;
(ii) Has been registered with the department
under RCW
82.32.030 for a continuous period of less
than one year as of the date that the department received the taxpayer's
application for a reseller permit;
(iii) Was on nonreporting status as
authorized under
RCW
82.32.045 at the time the department received
the taxpayer's application for a reseller permit or to renew or reinstate a
reseller permit;
(iv) Has filed
excise tax returns reporting no business activity for purposes of retail sales
and business and occupation (B&O) taxes for the twelve-month period
immediately preceding the date that the department received the taxpayer's
application for a reseller permit or to renew or reinstate a reseller permit;
or
(v) Has failed to file excise
tax returns covering any part of the twelve-month period immediately preceding
the department's receipt of the taxpayer's application for a reseller permit or
to renew or reinstate a reseller permit.
(b)
Federally recognized Indian
tribe. The provisions of (a) of this subsection do not apply to reseller
permits issued to any business owned by a federally recognized Indian tribe or
by an enrolled member of a federally recognized Indian tribe, if the business
does not engage in any business activity that subjects the business to the
B&O tax (chapter 82.04
RCW). A permit issued to such business is valid for forty-eight months from the
date of issuance, renewal, or reinstatement.
(c)
Contractors. A reseller
permit issued, renewed, or reinstated to a "contractor" as defined in WAC
458-20-10201(101)
is valid for a period of twenty-four months from the date of issuance, renewal,
or reinstatement.
(d)
Renewal
of reseller permit. An application to renew a reseller permit cannot be
made more than ninety days before the expiration of the reseller
permit.
(e)
Business
ownership change. A new reseller permit is required whenever a change in
the ownership of the buyer's business requires a new tax registration. The new
business may not make purchases under the authority of the reseller permit
issued to the business before the change in ownership.
(f)
Revoked or invalid reseller
permit. Purchases may not be made under the authority of a reseller
permit that has been revoked by the department or is otherwise invalid. For
more information about reseller permit revocation or other invalidation of
reseller permits, see subsection (14) of this rule.
(5)
Sales at wholesale. All
sales are treated as retail sales unless the seller takes from the buyer a copy
of a reseller permit, a uniform exemption certificate authorized by
RCW
82.04.470, or obtains the data elements
described in subsection (7) of this rule. Reseller permits may only be used for
sales at wholesale and generally may not be used as proof of entitlement to
retail sales tax exemptions otherwise provided by law.
(6)
When may a buyer use a reseller
permit? The buyer may use a reseller permit only when making wholesale
purchases. (See
RCW
82.04.060 for additional information.) The
reseller permit may not be used when making tax-exempt retail
purchases.
(7)
Seller's
responsibilities. The seller has the burden of proving that the buyer
had a reseller permit at the time of sale. A seller may meet that burden by
taking from the buyer, at the time of sale or within one hundred twenty days
after the sale, a copy of the reseller permit issued to the buyer by the
department under
RCW
82.32.780 or
82.32.783.
(a)
Registered buyer. In lieu of
a copy of a reseller permit issued by the department, pursuant to
RCW
82.04.470 a seller may accept from a buyer
that is
required to be registered with the department under
RCW
82.32.030:
(i) A properly completed uniform exemption
certificate approved by the streamlined sales and use tax agreement governing
board; or
(ii) Any other exemption
certificate authorized by the department and properly completed by the
buyer.
(b)
Inclusion of reseller permit number. Certificates authorized in
(a) of this subsection must include the reseller permit number issued by the
department to the buyer.
(c)
Seller not required to verify buyer's registration. A seller that
accepts exemption certificates authorized in (a) of this subsection is not
required to verify with the department whether the buyer is required to be
registered with the department under
RCW
82.32.030. Nothing in (c) of this subsection
may be construed to modify any of the provisions of
RCW
82.08.050.
(d)
Buyer not required to be
registered. In lieu of a copy of a reseller permit issued by the
department, pursuant to
RCW
82.04.470 a seller may accept from a buyer
that is
not required to be registered with the department under
RCW
82.32.030:
(i) A properly completed uniform sales and
use tax exemption certificate developed by the multistate tax
commission;
(ii) A properly
completed uniform exemption certificate approved by the streamlined sales and
use tax agreement governing board; or
(iii) Any other exemption certificate
authorized by the department and properly completed by the buyer.
The Streamlined Sales and Use Tax Agreement Certificate of
Exemption and the Multistate Tax Commission Uniform Sales and Use Tax Exemption
Certificate may each be obtained on the department's web site at
dor.wa.gov.
(e)
Seller not required to verify buyer's requirement to be
registered. A seller that accepts a uniform exemption certificate
authorized in (d) of this subsection is not required to verify with the
department whether the buyer is required to be registered with the department
under RCW
82.32.030. Nothing in this subsection (7)(e)
may be construed to modify any of the provisions of
RCW
82.08.050.
(f)
Data elements. In lieu of
obtaining a reseller permit or the documentation in (a) or (d) of this
subsection,
RCW
82.08.050 authorizes a seller to capture the
relevant data elements as allowed under the streamlined sales and use tax
agreement. "Data elements" are the information required to be supplied on the
actual Streamlined Sales and Use Tax Agreement Certificate of Exemption
including: Name, address, type of business, reason for exemption, reseller
permit number as applicable in this rule, identification number required by the
state to which the sale is sourced, state and country issuing identification
number, and if a paper form is used, the signature of the purchaser. See
Streamlined Sales Tax Governing Board, Inc. Rule 317.1 for more
information.
(g)
The term
"reseller permit." For purposes of this rule, unless otherwise
specified, the term "reseller permit" hereinafter contemplates all of the
following: A copy of a reseller permit, a uniform exemption certificate
authorized by
RCW
82.04.470 as described in (a) and (d) of this
subsection, or data elements as described in (f) of this subsection.
(h)
Seller must provide documentation
or information. If the seller has not obtained a reseller permit or the
documentation described in (a), (b), (d), or (f) of this subsection, the seller
is liable for the tax due unless it proves by establishing facts and
circumstances that show the sale was properly made at wholesale. The department
will consider all evidence presented by the seller, including the circumstances
of the sales transaction itself, when determining whether the seller has met
its burden . It is the seller's responsibility to provide the information
necessary to evaluate the facts and circumstances of all sales transactions for
which reseller permits were not obtained. Facts and circumstances that should
be considered include, but are not necessarily limited to, the following:
* The nature of the buyer's business. The items being purchased
at wholesale must be consistent with the buyer's business. For example, a buyer
having a business name of "Ace Used Cars" would generally not be expected to be
in the business of selling furniture;
* The nature of the items sold. The items sold must be of a
type that would normally be purchased at wholesale by the buyer; and
* Additional documentation. Other available documents, such as
purchase orders and shipping instructions, should be considered in determining
whether they support a finding that the sales are sales at wholesale.
(i)
Annual electronic
verification. Per
RCW
82.04.470 a seller that maintains records
establishing that it uses electronic means to verify, at least once per
calendar year, the validity of its customers' reseller permits need not take a
copy of a reseller permit or other documentation or the data elements as
authorized in (a), (d), or (f) of this subsection for wholesale sales to those
customers with valid reseller permits as confirmed by the department for all
sales occurring within twelve months following the date that the seller last
electronically verified the validity of its customers' reseller permits, using
the department's reseller permit verification system. A seller that meets the
requirements of this subsection will be deemed to have met its burden of
proving a sale is a wholesale sale rather than a retail sale.
(j)
May a seller request a refund for
sales tax paid out-of-pocket after obtaining appropriate documentation?
If the seller is required to make payment to the department, and later is able
to prove through proper documentation or by facts and circumstances that the
sales in question were wholesale sales, the seller may in writing request a
refund of the taxes paid along with the applicable interest. Both the request
and the documentation or proof that the sales in question were wholesale sales
must be submitted to the department within the statutory time limitations
provided by
RCW
82.32.060. For information on requesting
refunds see WAC
458-20-229. In the event of an
audit, refer to (m) of this subsection.
(k)
Timing requirements for single
orders with multiple billings. If a single order or contract will result
in multiple billings to the buyer, and a reseller permit was not obtained by
the seller or on file with the seller at the time the order was placed or the
contract entered, the seller may obtain a reseller permit within one hundred
twenty days after the first billing. For example, a subcontractor entering into
a construction contract for which it has not received a reseller permit must
obtain it within one hundred twenty days of the initial construction draw
request, even though the construction project may not be completed at that time
and additional draw requests will follow.
(l)
Proof of wholesale sales obtained,
from a buyer not required to be registered, after one hundred twenty days have
passed from sale date. If proof that a sale was a wholesale sale is
obtained more than one hundred twenty days after the sale or sales in question,
the nonregistered buyer must specifically identify the sale or sales to which
it applies. Certificates, such as a uniform exemption certificate, must be
accompanied by other documentation signed by the buyer specifically identifying
the sales in question and stating that the provisions of the accompanying
certificate apply. A nonspecific certificate that is not obtained within one
hundred twenty days is generally not, in and of itself, acceptable proof of the
wholesale nature of the sales in question. The certificate and/or required
documentation must be obtained within the statutory time limitations provided
by RCW
82.32.050.
(m)
Additional time to secure
documentation in an audit. If during an audit the department discovers
that the seller has not secured, as described in this subsection, the necessary
certificates and/or documentation, the seller will generally be allowed one
hundred twenty days in which to obtain and present appropriate certificates
and/or documentation, or prove by facts and circumstances the sales in question
were wholesale sales. The time allotted to the seller will commence from the
date the auditor initially provides the seller with the results of the
auditor's wholesale sales review. The department will not delay processing the
audit report as a result of the seller's failure within the allotted time to
secure and present appropriate documentation, or its inability to prove by
facts and circumstances that the sales in question were wholesale sales.
(8)
Department's
reseller permit verification system. Pursuant to
RCW
82.32.785, the department has developed a
system available on its web site that allows sellers to voluntarily verify
whether their customers' reseller permits are valid. Sellers are not obligated
to use the verification system. The system is accessible at the department's
web site at dor.wa.gov. Information available on the system includes the name
of the permit holder, the status of the reseller permit, and the expiration
date of the permit.
(9)
Penalty for improper use of reseller permit. If any buyer
improperly uses a reseller permit number, reseller permit, or other
documentation authorized under RCW 82.04.-470 to purchase items or services at
retail without payment of sales tax that is legally due on the purchase, the
department must assess against that buyer a penalty of fifty percent of the tax
due on the improperly purchased item or service. See
RCW
82.32.291. This penalty is in addition to all
other taxes, penalties, and interest due, and applies even if there was no
intent to evade the payment of retail sales tax. The penalty will be assessed
by the department and applies only to the buyer. However, see subsection (13)
of this rule for situations in which the department must waive the penalty.
(a)
Improper use of reseller
permit. A buyer that purchases items or services at retail without
payment of sales tax legally due on the purchase is deemed to have improperly
used a reseller permit number, reseller permit, or other documentation
authorized under
RCW
82.04.470 to purchase the items or services
without payment of sales tax and is subject to the penalty described above in
this subsection if the buyer:
(i) Furnished to
the seller a reseller permit number, a reseller permit or copy of a reseller
permit, or other documentation authorized under
RCW
82.04.470 to avoid payment of sales tax
legally due on the purchase; or
(ii) Purchased from a seller that had
previously used electronic means to verify the validity of the buyer's reseller
permit with the department and, as a result, did not require the buyer to
provide a copy of its reseller permit or furnish other documentation authorized
under
RCW
82.04.470 to document the wholesale nature of
the purchase. In such cases, the buyer bears the burden of proving that the
purchases made without payment of sales tax were qualified purchases or the
buyer remitted deferred sales tax directly to the department. The buyer not
realizing that sales tax was not paid at the time of purchase is not reason for
waiving the penalty.
Persons purchasing articles or services for dual purposes
(i.e., some for their own consumption and some for resale) should refer to
subsection (12) of this rule to determine whether they may furnish a reseller
permit to the seller.
(b)
Examples.
(i)
Example 1. During a routine
audit examination of a jewelry store, the department discovers that a dentist
has furnished a reseller permit for the purchase of a necklace. The "Notes"
section of the reseller permit indicates that in addition to operating a
dentistry practice, the dentist also sells jewelry. The jewelry store correctly
accepted the reseller permit as appropriate documentation.
Upon further investigation, the department finds that the
dentist is not engaged in selling jewelry. The department will impose the
retail sales tax, interest, and the fifty percent penalty for improper use of
the reseller permit against the dentist.
(ii)
Example 2. M&M Plumbing
Supply (M&M) has several regular customers that make purchases at
wholesale. M&M uses the department's reseller permit verification system to
find all regular customers that have a reseller permit. M&M keeps the
required data elements in its system and begins to make wholesale sales to all
customers the system shows have a reseller permit. While it is best for sellers
to ensure customers intend to purchase at wholesale, in this case, M&M has
satisfied its requirement to ensure that customers making wholesale purchases
have reseller permits. It is the customer's responsibility to review purchase
invoices to ensure that deferred sales tax is paid if the purchase is not a
valid wholesale purchase. If the customer does not pay the tax due on the next
tax return, the misuse penalty will be assessed.
(iii)
Example 3. ABC Bank hired
Sam's Clean-Up Services (Sam's) to provide a variety of services at properties
they had foreclosed on and owned. Sam's has provided services such as securing
the sites, winterizing, and making safety repairs. Other services provided
included lawn and yard services, debris removal, cleaning fixtures, repairing
walls and painting. These types of services on foreclosed properties are
generally retail sales and the use of a reseller permit by ABC Bank is a misuse
of it. The department will impose the retail sales tax, interest, and the fifty
percent penalty for improper use of the reseller permit.
(10)
Sales to nonresident
buyers. If the buyer is a nonresident , not engaged in business in this
state and is not required to be registered with the department under
RCW
82.32.030 but buys articles here for the
purpose of resale in the regular course of business outside this state, the
seller may accept the following from the buyer in lieu of a reseller permit:
(a) A properly completed uniform sales and
use tax exemption certificate developed by the multistate tax commission;
or
(b) A properly completed uniform
exemption certificate approved by the streamlined sales and use tax agreement
governing board. Nonresident buyers who are not required to be registered with
the department under
RCW
82.32.030 also may apply for and receive a
reseller permit. For more information about the application process and
eligibility requirements for reseller permits, see WAC
458-20-10201.
(11)
Sales to
farmers. Farmers selling agricultural products only at wholesale are
generally not required to register with the department. (See WAC
458-20-101 Tax registration and
tax reporting.)
(a)
Registered
farmers. Farmers who are required to be registered with the department
must obtain a reseller permit to substantiate wholesale purchases. In lieu of a
copy of a reseller permit issued by the department, a seller may accept from a
registered farmer a properly completed Farmers' Certificate for Wholesale
Purchases and Sales Tax Exemptions as long as that certificate includes the
reseller permit number issued by the department to the farmer. See
RCW
82.04.470.
(b)
Unregistered farmers.
Farmers not required to be registered with the department may provide, and the
seller may accept, any of the following documents to substantiate the wholesale
nature of a purchase in lieu of a reseller permit:
(i) A Farmers' Certificate for Wholesale
Purchases and Sales Tax Exemptions;
(ii) A properly completed uniform sales and
use tax exemption certificate developed by the multistate tax commission;
or
(iii) A properly completed
uniform exemption certificate approved by the streamlined sales and use tax
agreement governing board.
Farmers who are not required to be registered with the
department may apply for and receive a reseller permit. For more information
about the application process and eligibility requirements for reseller
permits, see WAC
458-20-10201.
(12)
Purchases
for dual purposes. A buyer normally engaged in both consuming and
reselling certain types of tangible personal property, and not able to
determine at the time of purchase whether the particular property purchased
will be consumed or resold, must purchase according to the general nature of
the buyer's business.
RCW
82.08.130. If the buyer principally consumes
the articles in question, the buyer should not give a reseller permit for any
part of the purchase. If the buyer principally resells the articles, the buyer
may furnish a reseller permit for the entire purchase. For the purposes of this
subsection, the term "principally" means greater than fifty percent.
(a)
Deferred sales tax
liability. If the buyer gives a reseller permit for all purchases and
thereafter consumes some of the articles purchased, the buyer must remit the
deferred sales tax on the value of the article used to the department. The
deferred sales tax liability should be reported under the use tax
classification on the buyer's excise tax return.
(i) Buyers making purchases for dual purposes
under the provisions of a reseller permit must remit deferred sales tax on all
products or services they consume. If the buyer fails to make a good faith
effort to remit this tax liability, the penalty for the misuse of a reseller
permit will be assessed on the unremitted portion of the deferred sales tax
liability.
A buyer will generally be considered to be making a good faith
effort to report its deferred sales tax liability if the buyer discovers a
minimum of eighty percent of its deferred sales tax liability within one
hundred twenty days of purchase, and remits the full amount of the discovered
tax liability on the next excise tax return. However, the penalty will not be
assessed if the buyer does not satisfy the eighty percent threshold)) but can
show by other facts and circumstances that it made a good faith effort to
report its tax liability. Likewise, if the department can show by other facts
and circumstances that the buyer did not make a good faith effort in remitting
its tax liability the penalty will be assessed, even if the eighty percent
threshold is satisfied.
(ii)
Example 4. This example
illustrates the use of a reseller permit for dual-use purchases.
BC Contracting operates as both a prime contractor and
speculative builder of residential homes. BC Contracting purchases building
materials from seller that are principally incorporated into projects upon
which BC acts as a prime contractor. BC provides seller with a reseller permit
and purchases all building materials at wholesale. BC must remit deferred sales
tax for all building materials incorporated into the speculative projects to be
considered to be properly using its reseller permit.
(b)
Tax paid at source
deduction. If the buyer does not provide a reseller permit to the seller
but pays retail sales tax on all articles of tangible personal property, and
subsequently resells a portion of the articles, the buyer must collect retail
sales tax from its retail customers as provided by law. When reporting these
sales on the excise tax return, the buyer may then claim a deduction to recover
the sales tax paid for the property resold.
(i) This deduction may be claimed under the
retail sales tax classification only. It must be identified as a "taxable
amount for tax paid at source" deduction on the deduction detail worksheet,
which must be filed with the excise tax return. Failure to properly identify
the deduction may result in the disallowance of the deduction. When completing
the local sales tax portion of the tax return, the deduction must be computed
at the local sales tax rate paid to the seller, and credited to the seller's
tax location code.
(ii)
Example 5. This example illustrates the tax paid at source
deduction .
A seller is located in Spokane and purchases equipment parts
for dual purposes from a supplier located in Seattle. The supplier ships the
parts to Spokane. The seller does not furnish a reseller permit for the
purchase, and remits retail sales tax to the supplier at the Spokane tax rate.
A portion of these parts are sold and shipped to a customer in Kennewick, with
retail sales tax collected at the Kennewick tax rate. The seller must report
the amount of the sale to the customer on its excise tax return and compute the
local sales tax liability using the Kennewick location code (0302) and rate.
The seller then should claim the tax paid at source deduction for the cost of
the parts resold to the customer, computing the local sales tax credit using
the Spokane location code (3210) and rate.
(iii) The department will allow the claim for
deduction only if the taxpayer keeps and preserves records in support of the
deduction that include the names of the persons from whom it purchased such
articles, the dates of the purchases, the types of articles, the amounts of the
purchases and the amounts of tax it paid.
(iv) Should the buyer resell the articles at
wholesale, or under other situations where retail sales tax is not to be
collected, the claim for the tax paid at source deduction on a particular
excise tax return may result in a credit. In such cases, the department will
issue a credit notice that may be used against future tax liabilities.
Alternatively, a taxpayer may request in writing a refund from the department.
(13)
Waiver of penalty for misuse of reseller permits. The department
will waive the penalty imposed for misuse of reseller permits if it finds that
the use of the reseller permit number, reseller permit, or other documentation
authorized under
RCW
82.04.470 to purchase items or services by a
person not entitled to use the reseller permit for that purpose was due to
circumstances beyond the control of the buyer or if the reseller permit number,
reseller permit, or other documentation authorized under
RCW
82.04.470 was properly used for purchases for
dual purposes and the buyer made a good faith effort to report deferred sales
tax. The use of a reseller permit to purchase items or services for personal
use outside of the business does not qualify for the waiver or cancellation of
the penalty. The penalty also will not be waived merely because the buyer was
not aware of either the proper use of the reseller permit or the penalty. In
all cases the burden of proving the facts is on the buyer.
Example 6. During a routine audit examination of a
computer dealer, the department discovers that a reseller permit was obtained
from a bookkeeping service. On further investigation it is discovered that the
bookkeeping service had no knowledge of the use of the reseller permit, and had
made no payment to the computer dealer. The employee who furnished the reseller
permit had purchased the computer for personal use, and had personally paid the
computer dealer.
The fifty percent penalty for the misuse of the reseller permit
will be waived for the bookkeeping service. The bookkeeping service had no
knowledge of the purchase and unauthorized use of the reseller permit. However,
the department will impose the taxes, interest, and the fifty percent penalty
for the misuse of the reseller permit against the employee.
(14)
Reseller permit revocation or
other invalidation. A reseller permit is no longer valid if the permit
holder's certificate of registration is revoked, the department closes the
permit holder's tax reporting account , or the permit holder otherwise ceases
to engage in business.
(a)
Closing of an
account. A taxpayer who ceases to engage in business will have its tax
reporting account closed by the department. The account can be closed per the
request of the taxpayer or administratively by the department. The department
will administratively close a tax reporting account if a taxpayer has not
reported any gross income or filed a return within the last two years. For more
information about administrative closure and reopening of taxpayer accounts,
see WAC
458-20-101.
(b)
Reseller permit revocation.
The department may revoke a reseller permit of a taxpayer for any of the
following reasons:
(i) The taxpayer used or
allowed or caused its reseller permit to be used to purchase any item or
service without payment of sales tax, and the taxpayer or other purchaser was
not entitled to use the reseller permit for the purchase;
(ii) The department issued the reseller
permit to the taxpayer in error;
(iii) The department determines that the
taxpayer is no longer entitled to make purchases at wholesale; or
(iv) The department determines that
revocation of the reseller permit would be in the best interest of collecting
taxes due under
Title
82 RCW.
(c)
Use of invalidated or revoked
reseller permit. The department will provide written notice to a
taxpayer whose reseller permit has been revoked or whose tax reporting account
has been administratively closed by the department as discussed in (a) of this
subsection . The revocation or invalidation is effective on the date specified
in the revocation or invalidation notice. Use of a revoked or invalidated
permit will result in the fifty percent penalty for improper use of a reseller
permit as discussed in subsection (9) of this rule.
(d)
Reinstatement of reseller
permit. A taxpayer wishing to have its reseller permit reinstated after
invalidation or revocation must apply to the department. For more information
about the application process for reseller permits, see WAC
458-20-10201.
(e)
Requests for reinstatement.
The department may refuse to reinstate a reseller permit revoked under (b)(i)
of this subsection until all taxes, penalties, and interest due on any
improperly purchased item or service have been paid in full. In the event a
taxpayer whose reseller permit has been revoked under (b)(i) of this subsection
reorganizes, the new business resulting from the reorganization is not entitled
to receive a reseller permit from the department until all taxes, penalties,
and interest due on any improperly purchased item or service have been paid in
full.
(f)
Business
reorganization. For purposes of this subsection, "reorganize" or
"reorganization" means:
(i) The transfer of a
majority of the assets of one business to another business, however affected,
where any of the persons having an interest in the ownership or management in
the former business maintain an ownership or management interest in the new
business, either directly or indirectly;
(ii) A mere change in identity or form of
ownership, however affected; or
(iii) The new business is a mere continuation
of the former business based on significant shared features such as owners,
personnel, assets, or general business activity.
(15)
Request for
copies. A person must, upon request of the department, provide paper or
electronic copies of all reseller permits, or other documentation as authorized
in RCW
82.04.470, accepted by that person during the
period specified by the department to substantiate wholesale sales. If, instead
of the documentation specified in this subsection, the seller has retained the
relevant data elements from such permits or other documentation authorized in
RCW
82.04.470, as allowed under the streamlined
sales and use tax agreement, the seller must provide such data elements to the
department.