Preproposal statement of inquiry was filed as WSR 03-07-065.
Title of Rule: WAC 458-61-100 Real estate excise tax -- Refunds of tax paid.
Purpose: Explains how and when a person may petition for a refund or [of] real estate excise taxes.
Statutory Authority for Adoption: RCW 82.45.150, 82.32.300, and 82.01.060(2).
Statute Being Implemented: RCW 82.45.060 and 82.45.100.
Summary: The rule explains how and when a person may petition for a refund of real estate excise taxes. The amendment corrects an incorrect rule citation in subsection (4) and clarifies those circumstances when refunds for rescissions may be made.
Reasons Supporting Proposal: Perkins v. King County, 51 W.2d 761, 321 P.2d 903 (1958) provides that no refund of real estate excise taxes may be made for an initial conveyance because the transaction is later rescinded. The rule provides more explicit guidance in line with this court decision to clarify when refunds following rescissions may be made.
Name of Agency Personnel Responsible for Drafting: Ed Ratcliffe, 1025 Union Avenue S.E., Suite #400, Olympia, WA, (360) 570-6126; Implementation and Enforcement: Ron Yamamoto, 2735 Harrison N.W., Building 4, Olympia, WA, (360) 753-2871.
Name of Proponent: Department of Revenue, governmental.
Rule is not necessitated by federal law, federal or state court decision.
Explanation of Rule, its Purpose, and Anticipated Effects: The proposed amendment of WAC 458-61-100 explains how and when a person may petition for a refund of real estate excise taxes. The amendments add titles for each subsection for easier reading. A rule citation is corrected in subsection (4) of the rule. Subsection (5) of the rule explains those circumstances when a refund of tax is authorized. This subsection (5) is amended to clarify when refunds of real estate excise taxes involving a rescission or an early recording prior to completion of the sale may be made. The purpose of the clarification is in part to ensure compliance with Perkins v. King County, 51 W.2d 761, 321 P.2d 903 (1958) (Refund of real estate excise tax is not allowed on initial transfer because of later rescission) and to give taxpayers, county treasurers, and department personnel more explicit directions concerning refunds when a sale is rescinded or recorded in error.
Proposal Changes the Following Existing Rules: This is a proposed revision of an existing rule, WAC 458-61-100. See Explanation of Rule above.
No small business economic impact statement has been prepared under chapter 19.85 RCW. A small business economic impact statement is not required because the rule does not impose any performance requirement upon any small business.
RCW 34.05.328 does not apply to this rule adoption. This is an interpretive rule as defined in RCW 34.05.328.
Hearing Location: Capitol Plaza Building, 4th Floor Large Conference Room, 1025 Union Avenue S.E., Olympia, WA, on June 25, 2003, at 10:00 a.m.
Assistance for Persons with Disabilities: Contact Sandy Davis no later than ten days before the hearing date, TTY 1-800-451-7985 or (360) 570-6175.
Submit Written Comments to: Ed Ratcliffe, Department of Revenue, P.O. Box 47467, Olympia, WA 98504-7467, fax (360) 664-0693, e-mail email@example.com, by June 25, 2003.
Date of Intended Adoption: July 7, 2003.
May 20, 2003
Alan R. Lynn
Legislation and Policy Division
AMENDATORY SECTION(Amending WSR 94-04-088, filed 2/1/94, effective 3/4/94)
WAC 458-61-100 Refunds of tax paid. (1) Introduction. Taxpayers who have paid the real estate excise tax or who have received a notice of assessment of tax and who wish to contest the application of the real estate excise tax to a particular transfer may file a petition for refund or correction of assessment as provided in this section. Only the taxpayer or the taxpayer's authorized agent may petition for a refund of tax.
(2) Petitioning for a refund. Any person who has overpaid any tax, interest, or penalty, may apply for a refund within four years from the date of sale by petitioning in writing for a refund of the amount overpaid. Claims for refund are to be made on forms prescribed by the department and made available at the county treasurers' offices and at the department.
(a) The taxpayer shall submit the completed form and all documentation supporting the claim for refund to the county treasurer's office in the county where the tax was originally paid.
(b) If the taxpayer originally paid the tax directly to the department, the form and supporting documentation shall be submitted to the department in accordance with the requirements of WAC 458-20-100, appeal procedures.
(3) County treasurer's responsibilities -- Petition received prior to sending affidavit to department. If the taxpayer submits the petition for refund before the county treasurer has sent to the department the copy of the affidavit which receipted the tax payment now in question, the county treasurer is authorized to void the receipted affidavit copies, based upon the criteria listed in subsection (5) of this section, and issue the refund. If the county treasurer authorizes and issues such refund, the voided copy of the affidavit, with a copy of the refund petition attached, must be included in the monthly affidavit batch sent to the department. If the county treasurer does not authorize such refund, the treasurer shall send the petition for refund, along with a copy of the affidavit and all supporting records, to the department. The procedure for petitions sent to the department shall follow subsection (4) of this section.
(4) County treasurer's responsibilities -- Petition
received after sending affidavit to department. If the
taxpayer submits the petition for refund after the county
treasurer has sent to the department the copy of the affidavit
which receipted the payment now in question, the county
treasurer shall verify the information on the petition and
forward it to the department with a copy of the affidavit and
any other supporting records furnished by the taxpayer. The
department shall approve or deny the refund. The taxpayer may
then appeal the imposition of the tax under the appeal
procedures. See WAC ((
458-61-100)) 458-20-100, appeals
procedures. If such petition is denied, the department will
return to the petitioner all supporting documents which are
submitted with the petition for refund.
(5) Circumstances under which a refund of tax is authorized. The authority to issue tax refunds under this chapter is limited to:
(a) The reconveyance for transactions that are completely rescinded as defined in WAC 458-61-590;
(b) The reconveyance for sales rescinded by court order. In such case a copy of the court decision must be attached to the department's affidavit copy by the county treasurer (see also WAC 458-61-330: Foreclosure -- Deeds in lieu of foreclosure);
(c) The initial conveyance recorded in error by an escrow agent before the closing date, provided the property is reconveyed back to the original owner;
(d) The reconveyance back to the original owner in (c) above;
(e) The initial conveyance recorded before a purchaser assumes an outstanding loan that represents the only consideration to be paid for the property, provided (i) the purchaser is unable to assume the loan and (ii) the property is reconveyed back to the original owner. The refund is allowed because the transaction lacked valuable consideration;
(f) The reconveyance back to the original owner in (e) above;
(g) Double payment of the tax;
(d))) (h) Overpayment of the tax through error of
(e))) (i) Failure of a taxpayer to claim tax exemption
for a transfer which was properly exempt.
[Statutory Authority: RCW 82.32.300 and 1993 sp.s. c 25. 94-04-088, § 458-61-100, filed 2/1/94, effective 3/4/94. Statutory Authority: RCW 82.45.120 and 82.45.150. 86-16-080 (Order PT 86-3), § 458-61-100, filed 8/6/86; 84-17-002 (Order PT 84-3), § 458-61-100, filed 8/2/84; 83-02-022 (Order PT 82-10), § 458-61-100, filed 12/28/82; 82-15-070 (Order PT 82-5), § 458-61-100, filed 7/21/82.]