H-4458.1 _______________________________________________
HOUSE BILL 2993
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State of Washington 55th Legislature 1998 Regular Session
By Representatives Van Luven, Quall, Sherstad, Dyer, D. Sommers and B. Thomas
Read first time 01/26/98. Referred to Committee on Finance.
AN ACT Relating to business and occupation tax reimbursements and advances received by property management companies for the payment of wages to on-site employees; adding a new section to chapter 82.04 RCW; creating a new section; and providing an effective date.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW SECTION. Sec. 1. The legislature finds that property owners often hire property management companies to manage their real property. Frequently, the property management companies also manage the personnel who perform the necessary services at the property location. In these cases, the property owners may pay the on-site personnel through the property management company. The property management company is merely acting as a conduit for the property owner's payment to the personnel at the property site.
This act is not intended to modify the taxation of amounts received by a property management company for purposes other than payment to on-site personnel.
NEW SECTION. Sec. 2. A new section is added to chapter 82.04 RCW to read as follows:
(1) This chapter does not apply to amounts received by a property management company from the owner of a property for gross wages and benefits paid directly to or on behalf of on-site personnel from property management trust accounts that are required to be maintained under RCW 18.85.310.
(2) As used in this section, "on-site personnel" means a person who meets all of the following conditions: (a) The person works primarily at the owner's property; (b) the person's duties include leasing property units, maintaining the property, collecting rents, or similar activities; and (c) under a written property management agreement: (i) The person's compensation is the ultimate obligation of the property owner and not the property manager; (ii) the property manager is liable for payment only as agent of the owner; and (iii) the property manager is the agent of the owner with respect to the on-site personnel and that all actions, including, but not limited to, hiring, firing, compensation, and conditions of employment, taken by the property manager with respect to the on-site personnel are subject to the approval of the property owner.
NEW SECTION. Sec. 3. This act takes effect July 1, 1998.
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