There are three state taxes that impact Washington nonprofits:

  1. Business & Occupation Tax: A nonprofit must file a Master Business License with the Department of Revenue if it will have employees or a revenue source on which it must pay State Business and Occupation Tax (B&O Tax) or Sales Tax. The B&O Tax taxes the gross income that your organization brings in. Donations, grants, and proceeds from fundraising events are exempt.
  2. Sales Tax: Organizations that sell products must pay sales tax.
  3. Property Tax: Unless a property is exempt, a nonprofit must pay property taxes on any property that it owns.

You can find more information about taxes in the Tax Basics for Nonprofits Toolkit

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