PREPROPOSAL STATEMENT OF INQUIRY
Subject of Possible Rule Making: WAC 458-20-216 Successors, quitting business.
Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 82.32.300 and 82.01.060(2).
Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: RCW 82.32.140 requires a taxpayer to remit any outstanding tax liability to the Department of Revenue within ten days of quitting business. If this tax is not paid by the taxpayer, any successor to the taxpayer becomes liable for the outstanding tax. This rule explains under what circumstances a person is considered a successor to a person quitting business. It explains the successor's responsibility for payment of an outstanding tax liability owed by the person taxpayer quitting business, whether that liability is known at the time of purchase or not. This rule also provides examples illustrating when successorship does or does not apply.
The department is considering a revision to this rule to incorporate provisions of chapter 13, Laws of 2003 1st sp.s. These provisions changed revised RCW 82.04.180 and 82.32.140 to change the conditions under which a person becomes a successor. They also provide that if the fair market value of assets acquired by a successor is less than $50,000, the successor's liability for payment of the taxpayer's unpaid tax is limited to the fair market value of the acquired assets.
Other Federal and State Agencies that Regulate this Subject and the Process Coordinating the Rule with These Agencies: None.
Process for Developing New Rule: Modified negotiated rule making.
Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication. Written comments may be submitted by mail, fax, or at the public meeting. Oral comments will be accepted at the public meeting. A preliminary draft of the proposed changes is available upon request. Written comments on and/or requests for copies of the rule may be directed to Allan C. Lau, Interpretations and Technical Advice Unit, P.O. Box 47453, Olympia, WA 98504-47453 [98504-7453], phone (360) 570-6134, fax (360) 586-5543.
Public Meeting Location: Capital Plaza Building, 4th Floor, Large Conference Room, 1025 Union Avenue S.E., Olympia, WA, on January 19, 2005, at 1:30 p.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) 725-7499.
December 1, 2004
Alan R. Lynn
Rules Coordinator