AN
ACT Relating to updating the tax code by making administrative clarifications,
correcting oversights, and deleting obsolete references; amending RCW
82.04.3651, 82.08.02567, 82.08.0266, 82.08.02665, 82.04.355, 82.12.020,
82.12.02567, 82.12.0282, 82.16.047, 82.32.060, 82.32.070, 82.35.080, 84.36.041,
84.36.350, 84.36.383, 83.100.020, and 11.02.005; reenacting RCW 82.04.270 and
82.04.270; adding a new section to chapter 82.12 RCW; repealing RCW 84.36.353
and 84.36.485; and providing effective dates.
BE IT ENACTED BY THE
LEGISLATURE OF THE STATE OF WASHINGTON:
Sec.
1. RCW
82.04.270 and 1998 c 312 s 6 and 1998 c 329 s 1 are each reenacted to read as
follows:
Upon
every person except persons taxable under RCW 82.04.260(5) ((or 82.04.332))
engaging within this state in the business of making sales at wholesale; as to
such persons the amount of tax with respect to such business shall be equal to
the gross proceeds of sales of such business multiplied by the rate of 0.484
percent.
Sec.
2. RCW
82.04.270 and 1998 c 343 s 2 and 1999 c . . . s 1 (section 1 of this
act) are each reenacted to read as follows:
Upon
every person except persons taxable under RCW 82.04.260(5) or 82.04.272
engaging within this state in the business of making sales at wholesale; as to
such persons the amount of tax with respect to such business shall be equal to
the gross proceeds of sales of such business multiplied by the rate of 0.484
percent.
Sec.
3. RCW
82.04.3651 and 1998 c 336 s 2 are each amended to read as follows:
(1)
This chapter does not apply to amounts received by nonprofit organizations, as
defined in subsection (2) of this section, for fund-raising activities.
(2)
As used in this section, a "nonprofit organization" means:
(a)
An organization exempt from tax under section 501(c) (3), (4), or (10) of the
federal internal revenue code (26 U.S.C. Sec. 501(c) (3), (4), or (10));
(b)
A nonprofit organization that would qualify under (a) of this subsection except
that it is not organized as a nonprofit corporation; or
(c)
A nonprofit organization that ((means [meets])) meets all of the
following criteria:
(i)
The members, stockholders, officers, directors, or trustees of the organization
do not receive any part of the organization's gross income, except as payment
for services rendered;
(ii)
The compensation received by any person for services rendered to the
organization does not exceed an amount reasonable under the circumstances; and
(iii)
The activities of the organization do not include a substantial amount of
political activity, including but not limited to influencing legislation and
participation in any campaign on behalf of any candidate for political office.
(3)
As used in this section, the term "fund-raising activity" means ((both
activities involving the direct solicitation)) soliciting or accepting
contributions of money or other property ((and)) or activities
involving the anticipated exchange of goods or services for money between
the soliciting organization and the organization or person solicited, for the
purpose of furthering the goals of the nonprofit organization.
"Fund-raising activity" does not include the operation of a regular
place of business in which sales are made during regular hours such as a
bookstore, thrift shop, restaurant, or similar business or the operation of
a regular place of business from which services are provided or performed
during regular hours such as the provision of retail, personal, or professional
services. The sale of used books, used videos, used sound recordings, or
similar used information products in a library, as defined in RCW 27.12.010, is
not the operation of a regular place of business for the purposes of this
section, if the proceeds of the sales are used to support the library.
Sec.
4. RCW
82.08.02567 and 1998 c 309 s 1 are each amended to read as follows:
(1)
The tax levied by RCW 82.08.020 shall not apply to sales of machinery and
equipment used directly in generating electricity using wind, sun, or landfill
gas as the principal source of power, or to sales of or charges made for labor
and services rendered in respect to installing such machinery and equipment,
but only if the purchaser develops with such machinery, equipment, and labor a
facility capable of generating not less than two hundred kilowatts of
electricity and provides the seller with an exemption certificate in a form and
manner prescribed by the department by rule((, and the purchaser provides
the department with a duplicate of the certificate or a summary of exempt sales
as the department may require)). The seller shall retain a copy of the
certificate for the seller's files.
(2)
For purposes of this section and RCW 82.12.02567:
(a)
"Landfill gas" means biomass fuel of the type qualified for federal
tax credits under 26 U.S.C. Sec. 29 collected from a landfill.
"Landfill" means a landfill as defined under RCW 70.95.030;
(b)
"Machinery and equipment" means industrial fixtures, devices, and
support facilities that are integral and necessary to the generation of
electricity using wind, sun, or landfill gas as the principal source of power;
(c)
"Machinery and equipment" does not include: (i) Hand-powered
tools; (ii) property with a useful life of less than one year; (iii) repair
parts required to restore machinery and equipment to normal working order; (iv)
replacement parts that do not increase productivity, improve efficiency, or
extend the useful life of machinery and equipment; (v) buildings; or (vi)
building fixtures that are not integral and necessary to the generation of
electricity that are permanently affixed to and become a physical part of a
building;
(d)
Machinery and equipment is "used directly" in generating electricity
by wind energy, solar, or landfill gas power if it provides any part of the
process that captures the energy of the wind, sun, or landfill gas, converts
that energy to electricity, and transforms or transmits that electricity for
entry into electric transmission and distribution systems.
(3)
This section expires June 30, 2005.
Sec.
5. RCW
82.08.0266 and 1980 c 37 s 33 are each amended to read as follows:
The tax levied by RCW 82.08.020 shall not apply to sales to
nonresidents of this state for use outside of this state of watercraft
requiring coast guard registration or registration by the state of principal
use according to the Federal Boating Act of 1958, even though delivery be made
within this state, but only when (1) the watercraft will not be used within
this state for more than forty-five days and (2) an appropriate exemption
certificate supported by identification ascertaining residence as ((provided))
required by the department of revenue and signed by the purchaser or his
agent establishing the fact that the purchaser is a nonresident and that the
watercraft is for use outside of this state, ((one)) a copy ((to
be filed with the department of revenue with the regular report and a duplicate
to be)) of which shall be retained by the dealer.
Sec.
6. RCW
82.08.02665 and 1993 c 119 s 1 are each amended to read as follows:
The
tax levied by RCW 82.08.020 does not apply to sales of vessels to residents of
foreign countries for use outside of this state, even though delivery is made
within this state, but only if (1) the vessel will not be used within this
state for more than forty-five days and (2) an appropriate exemption
certificate supported by identification as ((provided)) required
by ((and filed with)) the department of revenue and signed by the
purchaser or the purchaser's agent establishes the fact that the purchaser is a
resident of a foreign country and that the vessel is for use outside of this
state. ((One)) A copy of the exemption certificate ((is to be
filed with the department of revenue and a duplicate)) is to be retained by
the dealer.
As
used in this section, "vessel" means every watercraft used or capable
of being used as a means of transportation on the water, other than a seaplane.
NEW
SECTION. Sec. 7. A
new section is added to chapter 82.12 RCW to read as follows:
The
provisions of this chapter shall not apply in respect to the use of amusement
and recreation services by a nonprofit youth organization, as defined in RCW
82.04.4271, to members of the organization.
Sec.
8. RCW
82.04.355 and 1979 c 111 s 17 are each amended to read as follows:
This
chapter does not apply to any funds received in the course of commuter ride
sharing or ride sharing for ((the elderly and the handicapped)) persons
with special transportation needs in accordance with RCW 46.74.010.
Sec.
9. RCW
82.12.020 and 1998 c 332 s 7 are each amended to read as follows:
(1)
There is hereby levied and there shall be collected from every person in this
state a tax or excise for the privilege of using within this state as a
consumer: (a) Any article of tangible personal property purchased at retail,
or acquired by lease, gift, repossession, or bailment, or extracted or produced
or manufactured by the person so using the same, or otherwise furnished to a
person engaged in any business taxable under RCW 82.04.280 (2) or (7); or
(b) any canned software, regardless of the method of delivery, but excluding
canned software that is either provided free of charge or is provided for
temporary use in viewing information, or both((; or (c) any amusement or
recreation service defined as a retail sale in RCW 82.04.050(3)(a))).
(2)
This tax shall apply to the use of every service defined as a retail sale in
RCW 82.04.050(3)(a) and the use of every article of tangible personal property,
including property acquired at a casual or isolated sale, and including
byproducts used by the manufacturer thereof, except as hereinafter provided,
irrespective of whether the article or similar articles are manufactured or are
available for purchase within this state.
(3)
Except as provided in RCW 82.12.0252, payment by one purchaser or user of
tangible personal property or service of the tax imposed by chapter 82.08 or
82.12 RCW shall not have the effect of exempting any other purchaser or user of
the same property or service from the taxes imposed by such chapters.
(4)
The tax shall be levied and collected in an amount equal to the value of the
article used by the taxpayer multiplied by the rate in effect for the retail
sales tax under RCW 82.08.020.
Sec.
10. RCW
82.12.02567 and 1998 c 309 s 2 are each amended to read as follows:
(1)
The provisions of this chapter shall not apply with respect to machinery and
equipment used directly in generating not less than two hundred kilowatts of
electricity using wind, sun, or landfill gas as the principal source of power((,
but only when the user provides the department with:
(a)
An exemption certificate in a form and manner prescribed by the department
within sixty days of the first use of such machinery and equipment in this
state; or
(b)
An annual summary listing the machinery and equipment by January 31st of the
year following the calendar year in which the machinery and equipment is first
used in this state)).
(2)
The definitions in RCW 82.08.02567 apply to this section.
(3)
This section expires June 30, 2005.
Sec.
11. RCW
82.12.0282 and 1996 c 88 s 4 are each amended to read as follows:
The
tax imposed by this chapter shall not apply with respect to the use of
passenger motor vehicles used as ride-sharing vehicles((, as defined in RCW
46.74.010(3),)) by not less than five persons, including the driver, with a
gross vehicle weight not to exceed 10,000 pounds where the primary usage is for
commuter ride-sharing, as defined in RCW 46.74.010(((1))), by not less
than four persons including the driver when at least two of those persons are
confined to wheelchairs when riding, or passenger motor vehicles where the
primary usage is for ride-sharing for ((the elderly and the handicapped))
persons with special transportation needs, as defined in RCW 46.74.010(((2))),
if the vehicles are exempt under RCW 82.44.015 for thirty-six consecutive
months beginning within thirty days of application for exemption under this
section. If used as a ride-sharing vehicle for less than thirty-six
consecutive months, the registered owner of one of these vehicles shall notify
the department of revenue upon termination of primary use of the vehicle as a
ride-sharing vehicle and is liable for the tax imposed by this chapter.
To
qualify for the tax exemption, those passenger motor vehicles with five or six
passengers, including the driver, used for commuter ride-sharing, must be
operated either within the state's eight largest counties that are required to
develop commute trip reduction plans as directed by chapter 70.94 RCW or in
other counties, or cities and towns within those counties, that elect to adopt
and implement a commute trip reduction plan. Additionally at least one of the
following conditions must apply: (1) The vehicle must be operated by a public
transportation agency for the general public; or (2) the vehicle must be used
by a major employer, as defined in RCW 70.94.524 as an element of its commute
trip reduction program for their employees; or (3) the vehicle must be owned
and operated by individual employees and must be registered either with the
employer as part of its commute trip reduction program or with a public
transportation agency serving the area where the employees live or work.
Individual employee owned and operated motor vehicles will require
certification that the vehicle is registered with a major employer or a public
transportation agency. Major employers who own and operate motor vehicles for
their employees must certify that the commuter ride-sharing arrangement
conforms to a carpool/vanpool element contained within their commute trip
reduction program.
Sec.
12. RCW
82.16.047 and 1979 c 111 s 18 are each amended to read as follows:
This chapter does not apply to any funds received in the course of
commuter ride sharing or ride sharing for ((the elderly and the handicapped
in accordance with RCW 46.74.010)) persons with special transportation
needs in accordance with RCW 46.74.010.
Sec.
13. RCW
82.32.060 and 1997 c 157 s 2 are each amended to read as follows:
(1)
If, upon receipt of an application by a taxpayer for a refund or for an audit
of the taxpayer's records, or upon an examination of the returns or records of
any taxpayer, it is determined by the department that within the statutory
period for assessment of taxes, penalties, or interest prescribed by RCW
82.32.050 any amount of tax, penalty, or interest has been paid in excess of
that properly due, the excess amount paid within, or attributable to, such
period shall be credited to the taxpayer's account or shall be refunded to the
taxpayer, at the taxpayer's option. Except as provided in subsections (2) and
(3) of this section, no refund or credit shall be made for taxes, penalties, or
interest paid more than four years prior to the beginning of the calendar year
in which the refund application is made or examination of records is completed.
(2)
The execution of a written waiver under RCW 82.32.050 or 82.32.100 shall extend
the time for making a refund or credit of any taxes paid during, or
attributable to, the years covered by the waiver if, prior to the expiration of
the waiver period, an application for refund of such taxes is made by the
taxpayer or the department discovers a refund or credit is due.
(3)
Notwithstanding the foregoing limitations there shall be refunded or credited
to taxpayers engaged in the performance of United States government contracts
or subcontracts the amount of any tax paid, measured by that portion of the
amounts received from the United States, which the taxpayer is required by
contract or applicable federal statute to refund or credit to the United
States, if claim for such refund is filed by the taxpayer with the department
within one year of the date that the amount of the refund or credit due to the
United States is finally determined and filed within four years of the date on
which the tax was paid: PROVIDED, That no interest shall be allowed on such
refund.
(4)
Any such refunds shall be made by means of vouchers approved by the department
and by the issuance of state warrants drawn upon and payable from such funds as
the legislature may provide. However, taxpayers who are required to pay taxes
by electronic funds transfer under RCW 82.32.080 shall have any refunds paid by
electronic funds transfer.
(5)
Any judgment for which a recovery is granted by any court of competent
jurisdiction, not appealed from, for tax, penalties, and interest which were
paid by the taxpayer, and costs, in a suit by any taxpayer shall be paid in the
same manner, as provided in subsection (4) of this section, upon the filing
with the department of a certified copy of the order or judgment of the court.
(a)
Interest at the rate of three percent per annum shall be allowed by the
department and by any court on the amount of any refund, credit, or other
recovery allowed to a taxpayer for taxes, penalties, or interest paid by the
taxpayer before January 1, 1992. This rate of interest shall apply for all
interest allowed through December 31, 1998. Interest allowed after December
31, 1998, shall be computed at the rate as computed under RCW 82.32.050(2).
The rate so computed shall be adjusted on the first day of January of each year
for use in computing interest for that calendar year.
(b)
For refunds or credits of amounts paid or other recovery allowed to a taxpayer
after December 31, 1991, the rate of interest shall be the rate as computed for
assessments under RCW 82.32.050(2) less one percent. This rate of interest
shall apply for all interest allowed through December 31, 1998. Interest
allowed after December 31, 1998, shall be computed at the rate as computed
under RCW 82.32.050(2). The rate so computed shall be adjusted on the
first day of January of each year for use in computing interest for that
calendar year.
Sec.
14. RCW
82.32.070 and 1997 c 54 s 4 are each amended to read as follows:
(1)(((a)))
Every person liable for any fee or tax imposed by chapters 82.04 through 82.27
RCW shall keep and preserve, for a period of five years, suitable records as
may be necessary to determine the amount of any tax for which he may be liable,
which records shall include copies of all federal income tax and state tax returns
and reports made by him. All his books, records, and invoices shall be open
for examination at any time by the department of revenue. In the case of an
out-of-state person or concern which does not keep the necessary books and
records within this state, it shall be sufficient if it produces within the
state such books and records as shall be required by the department of revenue,
or permits the examination by an agent authorized or designated by the
department of revenue at the place where such books and records are kept. Any
person who fails to comply with the requirements of this section shall be
forever barred from questioning, in any court action or proceedings, the
correctness of any assessment of taxes made by the department of revenue based
upon any period for which such books, records, and invoices have not been so
kept and preserved.
(((b)))
(2) A person liable for any fee or tax imposed by chapters 82.04 through
82.27 RCW who contracts with another person or entity for work subject to
chapter 18.27 or 19.28 RCW shall obtain and preserve a record of the unified
business identifier account number for the person or entity performing the
work. Failure to obtain or maintain the record is subject to RCW 39.06.010 and
to a penalty determined by the director, but not to exceed two hundred fifty
dollars. The department shall notify the taxpayer and collect the penalty in
the same manner as penalties under RCW 82.32.100.
(((2)
Any person claiming a credit against the tax imposed by chapter 82.04 RCW by
reason of the provisions of RCW 82.04.435 shall keep and preserve until the
claim has been verified or allowed by the department of revenue sufficient
books, records and invoices to prove the right to and amount of such claim for
credit, and no such claim shall be allowed by the department of revenue unless
such books, records and invoices have been kept and preserved.))
Sec.
15. RCW
82.35.080 and 1996 c 186 s 522 are each amended to read as follows:
(1)
Except as provided in subsection (2) of this section, the department shall
revoke any certificate issued under this chapter if it finds that any of the
following have occurred with respect to the certificate:
(a)
The certificate was obtained by fraud or deliberate misrepresentation;
(b)
The certificate was obtained through the use of inaccurate data but without any
intention to commit fraud or misrepresentation;
(c)
The facility was constructed or operated in violation of any provision of this
chapter or provision imposed by the department as a condition of certification;
or
(d)
The cogeneration facility is no longer capable of being operated for the
primary purpose of cogeneration.
(2)
If the department finds that there are few inaccuracies under subsection (1)(b)
of this section and that cumulatively they are insignificant in terms of the
cost or operation of the facility or that the inaccurate data is not
attributable to carelessness or negligence and its inclusion was reasonable
under the circumstances, then the department may provide for the continuance of
the certificate and whatever modification it considers in the public interest.
(3)
Any person, firm, corporation, or organization that obtains a certificate
revoked under this section shall be liable for the total amount of money saved
by claiming the credits and exemptions provided under this chapter ((and RCW
84.36.485)). The total amount of the credits shall be collected as
delinquent business and occupation taxes, and the total of the exemptions shall
be collected and distributed as delinquent property taxes. Interest shall
accrue on the amounts of the credits and exemptions from the date the taxes
were otherwise due.
(4)
The department of community, trade, and economic development shall provide
technical assistance to the department in carrying out its responsibilities
under this section.
Sec.
16. RCW
84.36.041 and 1998 c 311 s 20 are each amended to read as follows:
(1)
All real and personal property used by a nonprofit home for the aging that is
reasonably necessary for the purposes of the home is exempt from taxation if
the benefit of the exemption inures to the home and:
(a)
At least fifty percent of the occupied dwelling units in the home are occupied
by eligible residents; or
(b)
The home is subsidized under a federal department of housing and urban
development program. The department of revenue shall provide by rule a
definition of homes eligible for exemption under this subsection (b),
consistent with the purposes of this section.
(2)
All real and personal property used by a nonprofit home for the aging that is
reasonably necessary for the purposes of the home is exempt from taxation if
the benefit of the exemption inures to the home and the construction,
rehabilitation, acquisition, or refinancing of the home is financed under a
program using bonds exempt from federal income tax if at least seventy-five
percent of the total amount financed uses the tax exempt bonds and the
financing program requires the home to reserve a percentage of all dwelling
units so financed for low-income residents. The initial term of the exemption
under this subsection shall equal the term of the tax exempt bond used in
connection with the financing program, or the term of the requirement to reserve
dwelling units for low-income residents, whichever is shorter. If the
financing program involves less than the entire home, only those dwelling units
included in the financing program are eligible for total exemption. The
department of revenue shall provide by rule the requirements for monitoring
compliance with the provisions of this subsection and the requirements for
exemption including:
(a)
The number or percentage of dwelling units required to be occupied by
low-income residents, and a definition of low income;
(b)
The type and character of the dwelling units, whether independent units or
otherwise; and
(c)
Any particular requirements for continuing care retirement communities.
(3)
A home for the aging is eligible for a partial exemption on the real property
and a total exemption for the home's personal property if the home does not
meet the requirements of subsection (1) of this section because fewer than
fifty percent of the occupied dwelling units are occupied by eligible
residents, as follows:
(a)
A partial exemption shall be allowed for each dwelling unit in a home occupied
by a resident requiring assistance with activities of daily living.
(b)
A partial exemption shall be allowed for each dwelling unit in a home occupied
by an eligible resident.
(c)
A partial exemption shall be allowed for an area jointly used by a home for the
aging and by a nonprofit organization, association, or corporation currently
exempt from property taxation under one of the other provisions of this
chapter. The shared area must be reasonably necessary for the purposes of the
nonprofit organization, association, or corporation exempt from property
taxation under one of the other provisions of this chapter, such as kitchen,
dining, and laundry areas.
(d)
The amount of exemption shall be calculated by multiplying the assessed value
of the property reasonably necessary for the purposes of the home, less the
assessed value of any area exempt under (c) of this subsection, by a fraction.
The numerator of the fraction is the number of dwelling units occupied by
eligible residents and by residents requiring assistance with activities of
daily living. The denominator of the fraction is the total number of occupied
dwelling units as of January 1st of the year for which exemption is claimed.
(4)
To be exempt under this section, the property must be used exclusively for the
purposes for which the exemption is granted, except as provided in RCW
84.36.805.
(5)
A home for the aging is exempt from taxation only if the organization operating
the home is exempt from income tax under section 501(c) of the federal internal
revenue code as existing on January 1, 1989, or such subsequent date as the
director may provide by rule consistent with the purposes of this section.
(6)
In order for the home to be eligible for exemption under subsections (1)(a) and
(((2))) (3)(b) of this section, each eligible resident of a home
for the aging shall submit an income verification form to the county assessor
by July 1st of the assessment year in which the application for exemption is ((made))
filed. The income verification form shall be prescribed and furnished
by the department of revenue. An eligible resident who has filed a form for a
previous year need not file a new form until there is a change in status
affecting the person's eligibility.
(7)
In determining the assessed value of a home for the aging for purposes of the
partial exemption provided by subsection (3) of this section, the assessor
shall apply the computation method provided by RCW 84.34.060 and shall consider
only the use to which such property is applied during the years for which such
partial exemptions are available and shall not consider potential uses of such
property.
(8)
As used in this section:
(a)
"Eligible resident" means a person who:
(i)
Occupied the dwelling unit as a principal place of residence as of January 1st
of the year for which the exemption is ((claimed)) filed.
Confinement of the person to a hospital or nursing home does not disqualify the
claim of exemption if the dwelling unit is temporarily unoccupied or if the
dwelling unit is occupied by a spouse, a person financially dependent on the
claimant for support, or both; and
(ii)
Is sixty-one years of age or older on December 31st of the year in which the
exemption claim is filed, or is, at the time of filing, retired from regular
gainful employment by reason of physical disability. Any surviving spouse of a
person who was receiving an exemption at the time of the person's death shall
qualify if the surviving spouse is fifty-seven years of age or older and
otherwise meets the requirements of this subsection; and
(iii)
Has a combined disposable income of no more than the greater of twenty-two
thousand dollars or eighty percent of the median income adjusted for family
size as most recently determined by the federal department of housing and urban
development for the county in which the person resides. For the purposes of
determining eligibility under this section, a "cotenant" means a
person who resides with an eligible resident and who shares personal financial
resources with the eligible resident.
(b)
"Combined disposable income" means the disposable income of the
person submitting the income verification form, plus the disposable income of
his or her spouse, and the disposable income of each cotenant occupying the
dwelling unit for the preceding calendar year, less amounts paid by the person
submitting the income verification form or his or her spouse or cotenant during
the previous year for the treatment or care of either person received in the
dwelling unit or in a nursing home. If the person submitting the income
verification form was retired for two months or more of the preceding year, the
combined disposable income of such person shall be calculated by multiplying
the average monthly combined disposable income of such person during the months
such person was retired by twelve. If the income of the person submitting the
income verification form is reduced for two or more months of the preceding
year by reason of the death of the person's spouse, the combined disposable
income of such person shall be calculated by multiplying the average monthly
combined disposable income of such person after the death of the spouse by
twelve.
(c)
"Disposable income" means adjusted gross income as defined in the
federal internal revenue code, as amended prior to January 1, 1989, or such
subsequent date as the director may provide by rule consistent with the purpose
of this section, plus all of the following items to the extent they are not
included in or have been deducted from adjusted gross income:
(i)
Capital gains, other than ((nonrecognized gain on the sale of a principal
residence under section 1034 of the federal internal revenue code, or))
gain excluded from income under section 121 of the federal internal revenue
code to the extent it is reinvested in a new principal residence;
(ii)
Amounts deducted for loss;
(iii)
Amounts deducted for depreciation;
(iv)
Pension and annuity receipts;
(v)
Military pay and benefits other than attendant-care and medical-aid payments;
(vi)
Veterans benefits other than attendant-care and medical-aid payments;
(vii)
Federal social security act and railroad retirement benefits;
(viii)
Dividend receipts; and
(ix)
Interest received on state and municipal bonds.
(d)
"Resident requiring assistance with activities of daily living" means
a person who requires significant assistance with the activities of daily
living and who would be at risk of nursing home placement without this
assistance.
(e)
"Home for the aging" means a residential housing facility that (i)
provides a housing arrangement chosen voluntarily by the resident, the
resident's guardian or conservator, or another responsible person; (ii) has
only residents who are at least sixty-one years of age or who have needs for
care generally compatible with persons who are at least sixty-one years of age;
and (iii) provides varying levels of care and supervision, as agreed to at the
time of admission or as determined necessary at subsequent times of
reappraisal.
(9)
A for-profit home for the aging that converts to nonprofit status after June
11, 1992, and would otherwise be eligible for tax exemption under this section
may not receive the tax exemption until five years have elapsed since the
conversion. The exemption shall then be ratably granted over the next five
years.
Sec.
17. RCW
84.36.350 and 1975 1st ex.s. c 3 s 1 are each amended to read as follows:
(1)
The following property shall be exempt from taxation:
(a)
Real or personal property owned and used by a nonprofit corporation in
connection with the operation of a sheltered workshop for handicapped persons,
and used primarily in connection with the manufacturing and the handling, sale
or distribution of goods constructed, processed, or repaired in such workshops
or centers; and
(b)
Inventory owned by a sheltered workshop for sale or lease by the sheltered
workshop or to be furnished under a contract of service, including raw
materials, work in process, and finished products.
(2)
Unless a different meaning is plainly required by the context, "sheltered
workshop" means a rehabilitation facility, or that part of a
rehabilitation facility operated by a nonprofit corporation, where any
manufacture or handiwork is carried on and operated for the primary purpose
of: (a) Providing gainful employment or rehabilitation services to the
handicapped as an interim step in the rehabilitation process for those who
cannot be readily absorbed in the competitive labor market or during such time
as employment opportunities for them in the competitive labor market do not
exist; or (b) providing evaluation and work adjustment services for handicapped
individuals.
Sec.
18. RCW
84.36.383 and 1995 1st sp.s. c 8 s 2 are each amended to read as follows:
As
used in RCW 84.36.381 through 84.36.389, except where the context clearly
indicates a different meaning:
(1)
The term "residence" ((shall)) means a single family
dwelling unit whether such unit be separate or part of a multiunit dwelling,
including the land on which such dwelling stands not to exceed one acre. The
term shall also include a share ownership in a cooperative housing association,
corporation, or partnership if the person claiming exemption can establish that
his or her share represents the specific unit or portion of such structure in
which he or she resides. The term shall also include a single family dwelling
situated upon lands the fee of which is vested in the United States or any
instrumentality thereof including an Indian tribe or in the state of
Washington, and notwithstanding the provisions of RCW 84.04.080 and 84.04.090,
such a residence shall be deemed real property.
(2)
The term "real property" shall also include a mobile home which has
substantially lost its identity as a mobile unit by virtue of its being fixed
in location upon land owned or leased by the owner of the mobile home and
placed on a foundation (posts or blocks) with fixed pipe, connections with
sewer, water, or other utilities((: PROVIDED, That)). A mobile
home located on land leased by the owner of the mobile home ((shall be))
is subject, for tax billing, payment, and collection purposes, only to
the personal property provisions of chapter 84.56 RCW and RCW 84.60.040.
(3)
"Department" ((shall)) means the state department of
revenue.
(4)
"Combined disposable income" means the disposable income of the
person claiming the exemption, plus the disposable income of his or her spouse,
and the disposable income of each cotenant occupying the residence for the
assessment year, less amounts paid by the person claiming the exemption or his
or her spouse during the assessment year for:
(a)
Drugs supplied by prescription of a medical practitioner authorized by the laws
of this state or another jurisdiction to issue prescriptions; and
(b)
The treatment or care of either person received in the home or in a nursing
home.
(5)
"Disposable income" means adjusted gross income as defined in the
federal internal revenue code, as amended prior to January 1, 1989, or such
subsequent date as the director may provide by rule consistent with the purpose
of this section, plus all of the following items to the extent they are not
included in or have been deducted from adjusted gross income:
(a)
Capital gains, other than ((nonrecognized gain on the sale of a principal
residence under section 1034 of the federal internal revenue code, or))
gain excluded from income under section 121 of the federal internal revenue
code to the extent it is reinvested in a new principal residence;
(b)
Amounts deducted for loss;
(c)
Amounts deducted for depreciation;
(d)
Pension and annuity receipts;
(e)
Military pay and benefits other than attendant-care and medical-aid payments;
(f)
Veterans benefits other than attendant-care and medical-aid payments;
(g)
Federal social security act and railroad retirement benefits;
(h)
Dividend receipts; and
(i)
Interest received on state and municipal bonds.
(6)
"Cotenant" means a person who resides with the person claiming the
exemption and who has an ownership interest in the residence.
Sec.
19. RCW
83.100.020 and 1998 c 292 s 401 are each amended to read as follows:
As
used in this chapter:
(1)
"Decedent" means a deceased individual;
(2)
"Department" means the department of revenue, the director of that
department, or any employee of the department exercising authority lawfully
delegated to him by the director;
(3)
"Federal credit" means (a) for a transfer, the maximum amount of the
credit for state taxes allowed by section 2011 of the Internal Revenue Code;
and (b) for a generation-skipping transfer, the maximum amount of the credit
for state taxes allowed by section 2604 of the Internal Revenue Code;
(4)
"Federal return" means any tax return required by chapter 11 or 13 of
the Internal Revenue Code;
(5)
"Federal tax" means (a) for a transfer, a tax under chapter 11 of the
Internal Revenue Code; and (b) for a generation-skipping transfer, the tax
under chapter 13 of the Internal Revenue Code;
(6)
"Generation-skipping transfer" means a "generation-skipping
transfer" as defined and used in section 2611 of the Internal Revenue
Code;
(7)
"Gross estate" means "gross estate" as defined and used in
section 2031 of the Internal Revenue Code;
(8)
"Nonresident" means a decedent who was domiciled outside Washington
at his death;
(9)
"Person" means any individual, estate, trust, receiver, cooperative
association, club, corporation, company, firm, partnership, joint venture,
syndicate, or other entity and, to the extent permitted by law, any federal,
state, or other governmental unit or subdivision or agency, department, or
instrumentality thereof;
(10)
"Person required to file the federal return" means any person
required to file a return required by chapter 11 or 13 of the Internal Revenue
Code, such as the personal representative of an estate; or a transferor,
trustee, or beneficiary of a generation-skipping transfer; or a qualified heir
with respect to qualified real property, as defined and used in section
2032A(c) of the Internal Revenue Code;
(11)
"Property" means (a) for a transfer, property included in the gross
estate; and (b) for a generation-skipping transfer, all real and personal
property subject to the federal tax;
(12)
"Resident" means a decedent who was domiciled in Washington at time
of death;
(13)
"Transfer" means "transfer" as used in section 2001 of the
Internal Revenue Code, or a disposition or cessation of qualified use as
defined and used in section 2032A(c) of the Internal Revenue Code;
(14)
"Trust" means "trust" under Washington law and any
arrangement described in section 2652 of the Internal Revenue Code; and
(15)
"Internal Revenue Code" means, for the purposes of this chapter and
RCW 83.110.010, the United States Internal Revenue Code of 1986, as amended or
renumbered on January 1, ((1998)) 1999.
Sec.
20. RCW
11.02.005 and 1998 c 292 s 117 are each amended to read as follows:
When
used in this title, unless otherwise required from the context:
(1)
"Personal representative" includes executor, administrator, special
administrator, and guardian or limited guardian and special representative.
(2)
"Net estate" refers to the real and personal property of a decedent
exclusive of homestead rights, exempt property, the family allowance and
enforceable claims against, and debts of, the deceased or the estate.
(3)
"Representation" refers to a method of determining distribution in
which the takers are in unequal degrees of kinship with respect to the
intestate, and is accomplished as follows: After first determining who, of
those entitled to share in the estate, are in the nearest degree of kinship, the
estate is divided into equal shares, the number of shares being the sum of the
number of persons who survive the intestate who are in the nearest degree of
kinship and the number of persons in the same degree of kinship who died before
the intestate but who left issue surviving the intestate; each share of a
deceased person in the nearest degree shall be divided among those of the
deceased person's issue who survive the intestate and have no ancestor then
living who is in the line of relationship between them and the intestate, those
more remote in degree taking together the share which their ancestor would have
taken had he or she survived the intestate. Posthumous children are considered
as living at the death of their parent.
(4)
"Issue" includes all the lawful lineal descendants of the ancestor
and all lawfully adopted children.
(5)
"Degree of kinship" means the degree of kinship as computed according
to the rules of the civil law; that is, by counting upward from the intestate
to the nearest common ancestor and then downward to the relative, the degree of
kinship being the sum of these two counts.
(6)
"Heirs" denotes those persons, including the surviving spouse, who
are entitled under the statutes of intestate succession to the real and
personal property of a decedent on the decedent's death intestate.
(7)
"Real estate" includes, except as otherwise specifically provided
herein, all lands, tenements, and hereditaments, and all rights thereto, and
all interest therein possessed and claimed in fee simple, or for the life of a
third person.
(8)
"Will" means an instrument validly executed as required by RCW
11.12.020.
(9)
"Codicil" means a will that modifies or partially revokes an existing
earlier will. A codicil need not refer to or be attached to the earlier will.
(10)
"Guardian" or "limited guardian" means a personal
representative of the person or estate of an incompetent or disabled person as
defined in RCW 11.88.010 and the term may be used in lieu of "personal
representative" wherever required by context.
(11)
"Administrator" means a personal representative of the estate of a
decedent and the term may be used in lieu of "personal
representative" wherever required by context.
(12)
"Executor" means a personal representative of the estate of a
decedent appointed by will and the term may be used in lieu of "personal
representative" wherever required by context.
(13)
"Special administrator" means a personal representative of the estate
of a decedent appointed for limited purposes and the term may be used in lieu
of "personal representative" wherever required by context.
(14)
"Trustee" means an original, added, or successor trustee and includes
the state, or any agency thereof, when it is acting as the trustee of a trust
to which chapter 11.98 RCW applies.
(15)
"Nonprobate asset" means those rights and interests of a person
having beneficial ownership of an asset that pass on the person's death under a
written instrument or arrangement other than the person's will.
"Nonprobate asset" includes, but is not limited to, a right or
interest passing under a joint tenancy with right of survivorship, joint bank
account with right of survivorship, payable on death or trust bank account,
transfer on death security or security account, deed or conveyance if
possession has been postponed until the death of the person, trust of which the
person is grantor and that becomes effective or irrevocable only upon the
person's death, community property agreement, individual retirement account or
bond, or note or other contract the payment or performance of which is affected
by the death of the person. "Nonprobate asset" does not include: A
payable-on-death provision of a life insurance policy, annuity, or other
similar contract, or of an employee benefit plan; a right or interest passing
by descent and distribution under chapter 11.04 RCW; a right or interest if,
before death, the person has irrevocably transferred the right or interest, the
person has waived the power to transfer it or, in the case of contractual arrangement,
the person has waived the unilateral right to rescind or modify the
arrangement; or a right or interest held by the person solely in a fiduciary
capacity. For the definition of "nonprobate asset" relating to
revocation of a provision for a former spouse upon dissolution of marriage or
declaration of invalidity of marriage, RCW 11.07.010(5) applies. For the
definition of "nonprobate asset" relating to revocation of a
provision for a former spouse upon dissolution of marriage or declaration of
invalidity of marriage, see RCW 11.07.010(5). For the definition of
"nonprobate asset" relating to testamentary disposition of nonprobate
assets, see RCW 11.11.010(7).
(16)
"Internal Revenue Code" means the United States Internal Revenue Code
of 1986, as amended or renumbered on January 1, ((1998)) 1999.
Words
that import the singular number may also be applied to the plural of persons
and things.
Words
importing the masculine gender only may be extended to females also.
NEW
SECTION. Sec. 21. The
following acts or parts of acts are each repealed:
(1) RCW
84.36.353 (Property owned or used for sheltered workshops for
handicapped--Shelter workshop defined) and 1998 c 311 s 22 & 1970 ex.s. c
81 s 2; and
(2) RCW
84.36.485 (Cogeneration facilities--Claims for
exemption--Forms--Verification--Administrative rules) and 1979 ex.s. c 191 s 9.
NEW
SECTION. Sec. 22.
Sections 1 and 3 through 21 of this act take effect August 1, 1999.
NEW SECTION. Sec. 23.
Section 2 of this act takes effect July 1, 2001.
