Effective Date of Rule: Thirty-one days after filing.

     Purpose: Chapter 23, Laws of 2010 1st sp. sess. changed the apportionment requirements for apportionable activities, effective June 1, 2010. The department had previously adopted emergency rules while it worked with stakeholders to develop permanent rules explaining the implications of this legislation.

     The department is at this time adopting a new permanent rule WAC 458-20-19402 (Rule 19402) Single factor receipts apportionment -- Generally. This rule provides general guidance on single factor receipts apportionment, how to attribute receipts, how to determine the receipts factor, and computing Washington taxable income.

     Statutory Authority for Adoption: RCW 82.32.300 and 82.01.060(2).

      Adopted under notice filed as WSR 12-06-080 on March 7, 2012.

     Changes Other than Editing from Proposed to Adopted Version:

•	Subsection (106), which provided an explanation of the use of examples, was moved to subsection (302) to be closer to the examples and further explanation was added to clarify that more than one reasonable method of proportionally attributing the benefit of a service may exist.
•	Subsection (304)(c), example 22 was modified to state that the use of population in the customer's market may be a reasonable method of proportionally attributing the benefit of a service.
•	Subsection (304)(c), example 24. This example was changed from general business services to human resources services to avoid confusion.
•	Subsection (304)(c), example 29. This example was removed from the rule. The remaining examples were renumbered.
•	Subsection (306), example 35 (formerly example 36) was modified to more accurately explain what is commercially reasonable.

     Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 1, Amended 0, Repealed 0.

     Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted on the Agency's Own Initiative: New 1, Amended 0, Repealed 0.

     Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0;      Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 0, Repealed 0.

     Date Adopted: September 17, 2012.

Alan R. Lynn

Rules Coordinator

     Reviser's note: The material contained in this filing exceeded the page-count limitations of WAC 1-21-040 for appearance in this issue of the Register. It will appear in the 12-20 issue of the Register.