Preproposal statement of inquiry was filed as WSR 05-06-124.
Title of Rule and Other Identifying Information: WAC 458-20-194 Doing business inside and outside the state.
Hearing Location(s): Capital Plaza Building, 4th Floor, Executive Large Conference Room, 1025 Union Avenue S.E., Olympia, WA 98504, on November 9, 2005, at 9:30 a.m.
Date of Intended Adoption: November 18, 2005.
Submit Written Comments to: Nathan Schreiner and Chris Coffman, P.O. Box 47453, Olympia, WA 98504-7453, e-mail NathanS@dor.wa.gov and ChrisC@dor.wa.gov, fax (360) 586-5543, by November 9, 2005.
Assistance for Persons with Disabilities: Contact Sandy Davis at (360) 725-7499 no later than ten days before the hearing date. Deaf and hard of hearing individuals may call 1-800-451-7985 (TTY users).
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: WAC 458-20-194 (Rule 194) explains the taxability of persons doing business both within and outside Washington. Because the apportionment principles for persons engaging in activities subject to the service and other activities B&O tax (RCW 82.04.460(1)) are discussed in very general terms only, most of the department's specific guidance on apportionment has been by Washington tax decision (WTD).
The department is proposing to amend this rule to provide more detailed and specific guidance on cost apportionment for businesses engaged in activities taxable under RCW 82.04.290 Service and other activities B&O tax and 82.04.2908 Boarding homes B&O tax. The amended rule will provide clearer guidance on when a business should use separate accounting or the cost apportionment method for determining the business' Washington B&O tax liability. The department has also added examples explaining when a business is subject to Washington B&O tax because it has nexus with Washington and the standards the department will use to determine if the business has nexus with another state.
The proposed rule provides clearer guidance on apportionment principles that is consistent with statute (RCW 82.04.460(1)) and, to the extent possible, based on records that businesses generally retain for other purposes and fairly measures the Washington activity of businesses.
The department anticipates canceling excise tax advisories (ETAs) 019.04.194, 269.04.194, 270.04.194, and 324.04.194/224 when amended Rule 194 becomes effective.
Reasons Supporting Proposal: Historically, the department has issued specific guidance concerning cost apportionment and separate accounting through published determinations (Washington tax decisions) as authorized by RCW 82.32.410. This has proved to be less than satisfactory for both the businesses and the department, because the determinations address only the facts before the department in a particular appeal. The proposed rule will provide specific guidance to all businesses that apportion their income pursuant to RCW 82.04.460(1).
Statutory Authority for Adoption: RCW 82.32.300 and 82.01.060(2).
Statute Being Implemented: RCW 82.04.460(1).
Rule is not necessitated by federal law, federal or state court decision.
Name of Proponent: Department of Revenue, governmental.
Name of Agency Personnel Responsible for Drafting: Nathan Schreiner, (360) 570-6136 and Chris Coffman, (360) 570-6150, 1025 Union Avenue S.E., Suite #544, Olympia, WA; Implementation: Alan R. Lynn, 1025 Union Avenue S.E., Suite #544, Olympia, WA, (360) 570-6125; and Enforcement: Janis P. Bianchi, 1025 Union Avenue S.E., Suite #544, Olympia, WA, (360) 570-6147.
No small business economic impact statement has been prepared under chapter 19.85 RCW. These changes do not impose more than minor costs on any small business.
A cost-benefit analysis is required under RCW 34.05.328. A preliminary cost-benefit analysis may be obtained by contacting Chris Coffman, 1025 Union Avenue S.E., Suite #544, Olympia, WA 98405 , phone (360) 570-6150, fax (360) 586-5543, e-mail ChrisC@dor.wa.gov. Additionally, the cost-benefit analysis is available under WAC 458-20-194 on the Department of Revenue's web page at http://dor.wa.gov/content/laws/draft/excise_tax.htm#102.
October 4, 2005
Alan R. Lynn
AMENDATORY SECTION(Amending Order ET 83-1, filed 3/30/83)
WAC 458-20-194 Doing business inside and outside the state. ((
Persons domiciled outside this state who (1) sell or
lease personal property to buyers or lessees in this state, or
(2) perform construction or installation contracts in this
state, or (3) render services to others herein, are doing
business in this state, irrespective of the domicile of such
persons and irrespective of whether or not such persons
maintain a permanent place of business in this state. Persons domiciled in and having a place of business in
this state, who (1) sell or lease personal property to buyers
or lessees outside this state, or (2) perform construction or
installation contracts outside this state, or (3) render
services to others outside this state, are doing business both
inside and outside this state. Whether or not such persons
are subject to business tax under the law depends upon the
kind of business and the manner in which it is transacted. The following general principles govern in determining tax
liability or tax immunity.
When the business involves a construction or installation
contract in this state, no deduction from the measure of the
tax is permitted, even though the contractor is domiciled
outside this state and maintains a place of business outside
this state which may contribute to the contract performed in
this state. See WAC 458-20-137, 458-20-170, 458-20-171 and
458-20-172. When the business involves a construction or installation
contract outside this state, the tax does not apply to any
part of the income derived therefrom (except such part of the
income as may be applicable to the manufacture in this state
by the contractor of articles used or incorporated in such
construction or installation), even though the contractor is
domiciled in this state and maintains a place of business
herein which may contribute to the contract performed outside
this state. See WAC 458-20-136. When the business involves a transaction taxable under
the classification service and other business activities, the
tax does not apply upon any part of the gross income received
for services incidentally rendered to persons in this state by
a person who does not maintain a place of business in this
state and who is not domiciled herein. However, the tax
applies upon the income received for services incidentally
rendered to persons outside this state by a person domiciled
herein who does not maintain a place of business within the
jurisdiction of the place of domicile of the person to whom
the service is rendered. For example, persons domiciled herein, but having no
place of business outside this state, are taxable upon the
following types of income:
(1) An insurance agency upon commissions received for insurance placed without the state.
(2) An attorney upon fees received from persons without the state, even though a portion of his services were necessarily performed without the state.
(3) A collection agency upon income received from clients without the state or with respect to collections made from persons without the state.
(4) An accountant upon income received from persons for services performed without the state.
(5) A financial business upon income received from loans placed without the state.
(6) A commodity broker upon commissions received from persons without the state.
(7) An advertising agency upon income received from advertising solicited and secured from firms without the state.
(8) An employment agency upon income received for securing employees for firms without the state.
(9) A physician upon income received from the treatment of patients without the state.
(10) A purchasing agency upon commissions received from clients without the state or with respect to purchases made without the state.
Persons engaged in a business taxable under the service and other business activities classification and who maintain places of business both inside and outside this state which contribute to the performance of a service, shall apportion to this state that portion of gross income derived from services rendered by them in this state. Where it is not practical to determine such apportionment by separate accounting methods, the taxpayer shall apportion to this state that proportion of total income which the cost of doing business within this state bears to the total cost of doing business both within and without this state.
For purposes of apportionment under RCW 82.04.460 and this rule the term "place of business" generally means a location at which regular business of the taxpayer is conducted and which is either owned by the taxpayer or over which the taxpayer exercises legal dominion and control. The term does not include locations or facilities at which the taxpayer acquires merely transient lodging nor does it include mere telephone number listings or telephone answering services.
(a) This rule applies to persons entitled to apportion income under RCW 82.04.460(1). Specifically the rule applies to taxpayers who maintain places of business both within and without the state that contribute to the rendition of services and who are taxable under RCW 82.04.290, 82.04.2908, or any other statute that provides for apportionment under RCW 82.04.460(1). Persons subject to the service and other activities, international investment income, licensed boarding home, and low-level radioactive waste disposal business and occupation (B&O) tax classifications, and who are not required to apportion their income under another statute or rule, should use this rule. In addition, this rule describes Washington nexus standards for business activities subject to apportionment under RCW 82.04.460(1). Nexus is described in subsection (2) of this section; separate accounting in subsection (4) of this section; and cost apportionment in subsection (5) of this section.
(b) Readers may also find helpful information in the following rules:
(i) WAC 458-20-14601 (Financial institutions -- Income apportionment).
(ii) WAC 458-20-170 (Constructing and repairing of new or existing buildings or other structures upon real property).
(iii) WAC 458-20-179 (Public utility tax).
(iv) WAC 458-20-193 (Inbound and outbound interstate sales of tangible personal property).
(c) The examples included in this section identify a number of facts and then state a conclusion. These examples should be used only as a general guide. The tax results of all situations must be determined after a review of all the facts and circumstances.
(a) Place of business - minimum presence necessary for tax. The following discussion of nexus applies only to gross income from activities subject to apportionment under this rule. A place of business exists in a state when a taxpayer engages in activities in the state that are sufficient to create nexus. Nexus is that minimum level of business activity or connection with the state of Washington which subjects the business to the taxing jurisdiction of this state. Nexus is created when a taxpayer is engaged in activities in the state, either directly or through a representative, for the purpose of performing a business activity. It is not necessary that a taxpayer have a permanent place of business within a state to create nexus.
(b) Examples. The following examples demonstrate Washington's nexus principles.
(i) Assume an attorney licensed to practice only in Washington performs services for clients located in both Washington and Florida. All of the services are performed within Washington. The attorney does not have nexus with any state other than Washington.
(ii) Assume the same facts as the example in (b)(i) of this subsection, plus the attorney attends continuing education classes in Florida related to the subject matter for which his Florida clients hired him. The attorney's presence in Florida for the continuing education classes does not create nexus because he is not engaging in business in Florida.
(iii) Assume the same facts as the example in (b)(ii) of this subsection, plus the attorney is licensed to practice law in Florida and frequently travels to Florida for the purpose of conducting discovery and trial work. Even though the attorney does not maintain an office in Florida, the attorney has nexus with both Washington and Florida.
(iv) Assume an architectural firm maintains physical offices in both Washington and Idaho. The architectural firm has nexus with both Washington and Idaho.
(v) Assume an architectural firm maintains its only physical office in Washington, and when the firm needs a presence in Idaho, it contracts with nonemployee architects in Idaho instead of maintaining a physical office in Idaho. Employees of the Washington firm do not travel to Idaho. Instead, the contract architects interact directly with the clients in Idaho, and perform the services the firm contracted to perform in Idaho. The architectural firm has nexus with both Washington and Idaho.
(vi) Assume the same facts as the example in (b)(v) of this subsection except the contracted architects never meet with the firm's clients and instead forward all work products to the firm's Washington office, which then submits that work product to the client. In this case, the architectural firm does not have nexus with Idaho. The mere purchase of services from a subcontractor located in another state that does not act as the business' representative to customers does not create nexus.
(vii) Assume that an accounting firm maintains its only office in Washington. The accounting firm enters into contracts with individual accountants to perform services for the firm in Oregon and Idaho. The contracted accountants represent the firm when they perform services for the firm's clients. The firm has nexus with Washington, Oregon, and Idaho.
(viii) Assume that an accounting firm maintains its only office in Washington and has clients located in Washington, Oregon, and Idaho. The accounting firm's employees frequently travel to Oregon to meet with clients, review client's records, and present their findings, but do not travel to Idaho. The accounting firm has nexus with Washington and Oregon, but does not have nexus with Idaho.
(ix) Assume that a sales representative earns commissions from the sale of tangible personal property. The sales representative is located in Oregon and does not enter Washington for any business purpose. The sales representative contacts Washington customers only by telephone and earns commissions on sales of tangible personal property to Washington customers. The sales representative does not have nexus with Washington and the commissions earned on sales to Washington customers are not subject to Washington's business and occupation tax.
(x) These above examples apply equally to situations where the Washington activities and out-of-state activities are reversed. For example, in example (b)(ix) of this subsection, if the locations were reversed, the sales representative would have nexus with Washington.
(3) Multiple lines of business.
(a) In general. If a taxpayer engages in two or more business activities, each of which is separately managed, uses separate employees, uses separate support services, and provides services unrelated to the other business activities, then the taxpayer is engaged in multiple lines of business. A taxpayer engaged in multiple lines of business must apportion the income for each line of business separately. Activities taxed under different B&O tax classifications are considered different lines of business for the purposes of this rule.
(i) Assume that a taxpayer engages in a stock brokerage business and separates the execution of trades from its investment advice and investment management activities into separate divisions. The taxpayer would not be considered to be engaged in distinct business activities because the execution of trades and investment management activities are related functions. The taxpayer will be required to apportion its entire income using either separate accounting or cost apportionment. It may not separately account for some of its income and use cost apportionment for the rest of its income.
(ii) Assume that a taxpayer maintains two separate divisions. One division is engaged in the business of providing janitorial services and the second division is engaged in the business of income tax preparation. Each division has separate management, there is no crossover of employees, and each maintains its own personnel, billing, accounting, and other support services. This taxpayer is engaged in multiple lines of business and each activity will be evaluated for apportionment purposes separately. Thus, the taxpayer may use separate accounting to apportion its income from the provision of janitorial services and use cost apportionment for its income tax preparation services.
(4) Separate accounting.
(a) In general. "Separate accounting" refers to a method of accounting that segregates and identifies sources or transactions which account for the generation of income within the state of Washington. Separate accounting is distinct from cost apportionment, which assigns a formulary portion of total worldwide income to Washington. A separate accounting method must be used by a business entitled to apportion its income under RCW 82.04.460(1) if this use results in an accurate description of gross income attributable to its Washington activities.
(b) Accuracy. Separate accounting is accurate only when the activities that significantly contribute, directly or indirectly, to the production of income can be identified and segregated geographically. Separate accounting thus links taxable income to activities occurring in a discrete jurisdiction. The result is inaccurate when services supporting these activities occur in different jurisdictions.
(c) Approved methods of separate accounting. The following methods of separate accounting are acceptable to the department, if accurate:
(i) Billable hours of employees or representative third parties performing services in Washington. If a business charges clients an hourly rate for the performance of services, and the place of performance of the employee, contractor, or other individual whose time is billed is reasonably ascertainable, then the billable hours may be used as a basis for separate accounting. The gross amount received from hours billed for services performed in Washington should be reported.
(ii) Specific projects or contracts. A business may assign the revenue from specific projects or contracts in or out of Washington by the primary place of performance. For example, a consulting business with no other presence in Washington that agrees to provide on-site management consulting services for a Washington business and receives five hundred thousand dollars in payment for the project must report five hundred thousand dollars in gross income to Washington. If the same business gets another Washington client for on-site management consulting, and receives another payment of five hundred thousand dollars, the business must report an additional five hundred thousand dollars in gross income to Washington. If a business contracts to distribute advertisements within the state of Washington, the gross amount received for this action should be reported as Washington income.
(iii) Other reasonable and accurate methods -- Notice to the department.
(A) A taxpayer may report with, or the department may require, the use of one of the alternative methods of separate accounting.
(B) A taxpayer reporting under this subsection must notify the department at the time of filing that it is using an alternative method and provide a brief description of the method employed. If a taxpayer reports using an alternate method, the same method must be used for all subsequent tax reporting periods unless it is demonstrated another method is necessary under the standard in (c)(iii)(D) of this subsection.
(C) If on review of a taxpayer's return(s) the department determines another method is necessary to fairly represent the extent of a taxpayer's business activity in Washington, then the department may impose the method for all returns within the statute of limitations. Statutory interest applies to both balances due and refund or credit claims arising under this section. Further, applicable penalties will be imposed on balances due arising under this section. However, if the taxpayer reported using the separate accounting method in (c) of this subsection or cost apportionment under subsection (5) of this section, the department may impose the alternate method for future periods only.
(D) A taxpayer may request that the department approve an alternative method of separate accounting by submitting a request for prior ruling pursuant to WAC 458-20-100. Such letter ruling may be subject to audit verification before issuance.
(E) The taxpayer or the department, in imposing or requesting an alternate method, must demonstrate by clear and convincing evidence that the separate accounting methods in (c) of this subsection do not fairly represent the extent of the taxpayer's business activity in Washington.
(5) Cost apportionment.
(a) Apportionment ratio. The apportionment ratio is the cost of doing business in Washington divided by the total cost of doing business as described in RCW 82.04.460(1). A different ratio must be used for each line of business described in subsection (3) of this section. Cost may not be included in more than one ratio. An apportionment ratio is calculated under this rule as follows. The denominator of the apportionment ratio is the worldwide costs of the apportionable activity and the numerator is all costs specifically assigned to Washington plus all costs assigned to Washington by formula, as described below. Costs are calculated on a worldwide basis for the tax reporting period in question. The tax due to Washington is calculated by multiplying total income times the apportionment ratio times the tax rate. Available tax credits may be applied against the result. Statutory interest and penalties apply to underreported income. For the purposes of this rule, "total income" means gross income under the tax classification in question, less deductions, calculated as if the B&O tax classification applied on a worldwide basis.
(b) Place of business requirement. A taxpayer must maintain places of business within and without Washington that contribute to the rendition of its services in order to apportion its income. This "place of business" requirement, however, does not mean that the taxpayer must maintain a physical location as a place of business in another taxing jurisdiction in order to apportion its income. If a taxpayer has activities in a jurisdiction sufficient to create nexus under Washington standards, then the taxpayer is deemed to have a "place of business" in that jurisdiction for apportionment purposes. See subsection (2) of this section.
(c) Noncost expenditures. The following is a list of expenditures that are not costs of doing business within the meaning of RCW 82.04.460 and are therefore excluded from both the numerator and the denominator of the apportionment ratio. Expenditures that are not costs of doing business include expenditures that exchange one business asset for another; that reflect a revaluation of an asset not consumed in the course of business; or federal, state, or local taxes measured by gross or net business income. This list is not exclusive. Costs of another line of business under subsection (3) of this section are also excluded from an individual apportionment ratio. Similarly, the costs of acquiring a business by merger or otherwise, including the financing costs, are not the costs of doing the apportioned business activity and must be excluded from the cost apportionment calculation.
(i) The cost of acquiring assets that are not depreciated, amortized, or otherwise expensed on the taxpayer's books and records on the basis of generally accepted accounting principles (GAAP), or a loss incurred on the sale of such assets. For example, expenditures for land and investments are excluded from the cost apportionment formula.
(ii) Taxes (other then taxes specifically related to items of property such as retail sales or use taxes and real and personal property taxes).
(iii) Asset revaluations such as stock impairment or goodwill impairment.
(d) Specifically assigned costs. Real or tangible personal property costs, employee costs, and certain payments to third parties are specifically assigned under (e) through (g) of this subsection.
(e) Property costs.
(i) Definitions. Real or tangible personal property costs are defined to include:
(A) Depreciation as reported on the taxpayer's books and records according to GAAP;
(B) Maintenance costs for specific property;
(C) Insurance costs for specific property;
(D) Utility costs for specific property;
(E) Lease or rental payments for specific property;
(F) Interest costs for specific property; and
(G) Taxes for specific property.
(ii) Assignment of costs. Real or tangible personal property costs are assigned to the location of the property. Property in transit between locations of the taxpayer to which it belongs is assigned to the destination state. Property in transit between a buyer and seller and included by a taxpayer in the denominator of the apportionment ratio in accordance with its regular accounting practices is assigned to the destination state. Mobile or movable property located both within and without Washington during the measuring period is assigned in proportion to the total time within Washington during the measuring period. An automobile assigned to a traveling employee is assigned to the state to which the employee's compensation is assigned below or to the state in which the automobile is licensed. Where a business contracts for the maintenance or insurance of multiple properties, the rental or depreciation expense may be used to assign these costs.
(f) Employee costs.
(i) Definitions. For the purposes of this subsection:
(A) "Compensation" means wages, salaries, commissions, and any other form of remuneration paid to or accrued to employees for personal services. Employer contributions under a qualified cash plan, deferred arrangement plan, and nonqualified deferred compensation plan are considered compensation. Stock based compensation is considered compensation under this rule to the extent included in gross income for federal income tax purposes.
(B) "Employee" means any individual who, under the usual common-law rules applicable in determining the employer-employee relationship, has the status of an employee, but does not include corporate officers.
(ii) Allocation method. Employee costs include all compensation paid to employees. An employee's compensation is assigned to Washington if the taxpayer reports the employee's wages to Washington for unemployment compensation purposes. Employee wages reported for federal income tax purposes may be used to assign the remaining compensation costs.
(g) Representative third-party costs.
(i) Definitions. For the purposes of this section:
"Representative third party" includes an agent, independent contractor, or other representative of the taxpayer who provides services on behalf of the taxpayer directly to customers. The term includes leased employees who meet the standards under this subsection (5)(g) of this section.
(ii) Allocation method. Payments to a representative third party are assigned to the third party's place of performance. For example, if a business subcontracts with a representative third party who provides services on behalf of the taxpayer from a California location, the cost of compensating the representative third party is assigned to California. This is true even if the third party provides services to Washington customers. Conversely, the cost of compensating a representative third party providing services to California customers from a Washington location is assigned to Washington.
(A) X, a Washington business, hires Taxpayer to design and write custom software for a document management system. Taxpayer subcontracts with Z, whose employees determine the needs of X, negotiate a statement of work, write the custom software, and install the software. Z's employees perform all of these services on-site at the X business location. Taxpayer's payments to Z are representative third-party costs and specifically assigned to Washington.
(B) Taxpayer, a service provider, subcontracts with X, who agrees to maintain a customer service center where staff will answer telephone inquiries about Taxpayer's services. X in turn subcontracts with Z, whose employees actually respond to questions from a phone center located in California. The payments by taxpayer to X are representative third-party costs with respect to Taxpayer because X is responsible for providing the staff of the service center. The payments to X are specifically assigned to California.
(C) Taxpayer sells various manufacturers' products at wholesale on a commission basis. Taxpayer subcontracts with X, who agrees to act as Taxpayer's sales representative on the West Coast. Taxpayer has various other sales representatives working on as independent contractors, who are assigned territories, but may make sales from an office or through in-person visits, or a combination of both. Taxpayer does not maintain records sufficient to show the representatives' places of performance. Taxpayer may use sales records and the standards under (h) of this subsection to assign commissions by each subcontractor.
(h) Costs assigned by formula.
(i) Costs not specifically assigned under (e) through (g) of this subsection and not excluded from consideration by (a) or (c) of this subsection are assigned to Washington by formula. These costs are multiplied by the ratio of sales in Washington over sales everywhere. For example, travel costs are not specifically assigned. If a business has one thousand dollars in travel costs and sales of ten thousand dollars in each of the four states in which it has nexus under Washington standards (including Washington), twenty-five percent, or two hundred fifty dollars of the travel costs are assigned to Washington.
(ii) Sales are assigned to where the customer receives the benefit of the service. If the location where the services are received is not readily determinable, the services are attributed to the location of the office of the customer from which the services were ordered in the regular course of the customer's trade or business. If the ordering office cannot be determined, the services are attributed to the office of the customer to which the services are billed.
(iii) If under the method described above a sale is attributed to a location where the taxpayer does not have nexus under Washington standards, the sale must be excluded from both the numerator and denominator of the sales ratio. For the purposes of this calculation only, the department will presume a taxpayer has nexus anywhere the taxpayer has employees or real property, or where the taxpayer reports income or business activity taxes in the state. The burden is on the taxpayer to demonstrate nexus exists in other states.
(i) Alternative methods.
(i) A taxpayer may report with, or the department may require, the use of one of the alternative methods of cost apportionment described below:
(A) The exclusion of one or more categories of costs from consideration;
(B) The specific allocation of one or more categories of costs which will fairly represent the taxpayer's business activity in Washington; or
(C) The employment of another method of cost apportionment that will effectuate an equitable apportionment of the taxpayer's gross income.
(ii) A taxpayer reporting under (5)(i) of this section must notify the department at the time of filing that it is using an alternative method and provide a brief description of the method employed. If a taxpayer reports using an alternate method, the same method must be used for all subsequent tax reporting periods unless it is demonstrated another method is necessary under the standard in (i)(iv) of this subsection.
(iii) If on review of a taxpayer's return(s) the department determines another method is necessary to fairly represent the extent of a taxpayer's business activity in Washington, the department may impose the method for all returns within the statute of limitations. Statutory interest applies to both balances due and refund or credit claims arising under this section. Further, applicable penalties will be imposed on balances due arising under this section. However, if the taxpayer reported using the cost apportionment method in (a) through (h) of this subsection and separate accounting is unavailable, the department may impose the alternate method for future periods only.
(iv) A taxpayer may request that the department approve an alternative method of cost apportionment by submitting a request for prior ruling pursuant to WAC 458-20-100. Such letter ruling may be subject to audit verification before issuance.
(v) The taxpayer or the department, in imposing or requesting an alternate method, must demonstrate by clear and convincing evidence that the cost apportionment method in (a) through (h) of this subsection does not fairly represent the extent of the taxpayer's business activity in Washington.
(6) Effective date. This amended rule shall be effective for tax reporting periods beginning on January 1, 2006, and thereafter.
[Statutory Authority: RCW 82.32.300. 83-08-026 (Order ET 83-1), § 458-20-194, filed 3/30/83; Order ET 70-3, § 458-20-194 (Rule 194), filed 5/29/70, effective 7/1/70.]