BILL REQ. #:  S-3557.2 

Read first time 01/18/10.   Referred to Committee on Ways & Means.

     AN ACT Relating to limiting the business and occupation tax deduction for dues and fees to certain nonprofits exempt from federal income tax; amending RCW 82.04.4282; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1   RCW 82.04.4282 and 2009 c 535 s 410 are each amended to read as follows:
     In computing tax there may be deducted from the measure of tax amounts derived from bona fide (1) dues and initiation fees paid to nonprofit organizations exempt from the federal income tax under Title 26 U.S.C. Sec. 501(c)(3), (c)(4), (c)(5), (c)(6), (c)(8), (c)(10), or (c)(19) of the federal internal revenue code, as amended as of January 1, 2010, (2) ((dues, (3))) contributions, (((4))) (3) donations, (((5))) (4) tuition fees, (((6))) (5) charges made by a nonprofit trade or professional organization for attending or occupying space at a trade show, convention, or educational seminar sponsored by the nonprofit trade or professional organization, which trade show, convention, or educational seminar is not open to the general public, (((7))) (6) charges made for operation of privately operated kindergartens, and (((8))) (7) endowment funds. This section may not be construed to exempt any person, association, or society from tax liability upon selling tangible personal property, digital goods, digital codes, or digital automated services, or upon providing facilities or other services for which a special charge is made to members or others. If dues are in exchange for any significant amount of goods or services rendered by the recipient thereof to members without any additional charge to the member, or if the dues are graduated upon the amount of goods or services rendered, the value of such goods or services ((shall)) may not be considered as a deduction under this section.

NEW SECTION.  Sec. 2   This act takes effect July 1, 2010.