Tax Audit Protest and Appeal — Washington

Tax Audit Protest and Appeal (WASHINGTON)

Quick-Reference Summary

Part A — Informal Conference Request Letter (Pre-Petition)

Sender Letterhead

[LAW FIRM OR TAXPAYER NAME]
[Street Address]
[City], Washington [ZIP]
Telephone: [(___) ___-____]
Email: [______________________]
[WA Bar No. (if attorney): ____________]
UBI / Tax Registration: [____________]

Date and Recipient

Date: [__/__/____]

VIA EMAIL AND CERTIFIED MAIL

[AUDITOR NAME], Revenue Auditor
[AUDIT SUPERVISOR NAME]
Washington State Department of Revenue — Audit Division
[Region Office Address]

Re Block

Re: Request for Pre-Assessment Audit Conference / Extension of Time to Petition
Taxpayer: [TAXPAYER LEGAL NAME]
UBI: [____________]
Audit ID / Letter ID: [____________]
Tax Type(s): [B&O / Sales / Use / Public Utility / Other]
Audit Period: [MM/YYYY] – [MM/YYYY]
Audit Report Date: [__/__/____]

Body

Dear [Auditor/Supervisor]:

This letter requests an informal audit conference under the Department's published audit procedures to address material legal and factual issues identified in the audit report dated [__/__/____] before issuance of a final audit assessment. Taxpayer also requests, to the extent the audit becomes final, the customary 30-day extension of time to file a Petition for Review with the Appeals Division under WAC 458-20-100, recognizing that the petition deadline is otherwise 30 days from the date of the audit assessment.

1. Representative. [REPRESENTATIVE NAME, FIRM, ADDRESS, PHONE, EMAIL] is authorized to represent Taxpayer. A signed Confidential Tax Information Authorization (REV 42 2446) is attached.

2. Disputed Items. Principal issues are identified in Exhibit A and include:

3. Documents. Taxpayer is providing additional records (Exhibits B–__), including reconciliations from book income to B&O taxable income, exemption certificates, and sourcing workpapers.

4. Conference format. Taxpayer requests a [telephone / video / in-person] conference at the earliest mutually convenient date.

5. Reservation. Taxpayer reserves all rights to file a timely Petition for Review under Rule 100, to appeal any Final Determination to the Board of Tax Appeals under RCW 82.03.190, and to bring a refund action in superior court under RCW 82.32.180.

Respectfully,

________________________________
[NAME], [TITLE]
[For:] [TAXPAYER]

Part B — Petition for Review (Rule 100) — Formal Protest

I. Caption

STATE OF WASHINGTON
DEPARTMENT OF REVENUE
ADMINISTRATIVE REVIEW AND HEARINGS DIVISION (APPEALS)

PETITION FOR REVIEW
(RCW 82.32.160; WAC 458-20-100)

II. Required Petition Contents (WAC 458-20-100(2))

1. Taxpayer: [Name]; [Address]; UBI / Registration No. [______]; Telephone [____]; Fax [____]; Email [____]; Contact: [____].
2. Representative (if any): [NAME, FIRM, ADDRESS, PHONE, EMAIL]; CTIA Form attached as Exhibit 1.
3. Audit / Assessment Identification: Audit ID [_______]; Letter ID [_______]; Tax warrant/balance due notice [_______]; copy of assessment attached as Exhibit 2.
4. Tax types and periods: [____].
5. Amount in Controversy: $[______] in tax; $[______] in interest; $[______] in penalties.
6. Type of Review Requested: ☐ Small Claims (≤ $50,000) ☐ Mainstream ☐ Executive
7. Hearing Preference: ☐ In-person Olympia ☐ In-person Seattle ☐ Telephone ☐ Video ☐ No hearing (paper)
8. Statement of Issues and Argument: see Section V below.

III. Timeliness

The audit assessment was issued on [__/__/____]. This Petition is filed on [__/__/____], within 30 calendar days of the date of the assessment as required by WAC 458-20-100(2). [If applicable: Taxpayer was granted a written extension to file through [__/__/____] (Exhibit __).]

IV. Statement of Facts

1. Taxpayer is a [WA / foreign] [entity type] engaged in [____] in Washington and elsewhere.
2. During the audit period, Taxpayer reported B&O / sales / use taxes under the following classifications: [____].
3. DOR conducted a field audit beginning [__/__/____] and issuing a final audit report on [__/__/____].
4. The audit adjustments at issue include: [____].

V. Issues and Argument (WAC 458-20-100(2))

For each issue, Taxpayer (a) describes the issue, (b) cites supporting authority, and (c) provides supporting documentation.

☐ Issue 1 — B&O Classification. [E.g., Receipts from [activity] are properly classified under [classification], not [classification], under RCW 82.04.290 and WAC 458-20-_____.]

• Authority: [RCWs / WACs / Determinations / Court opinions]
• Documentation: Exhibits [__]–[__]

☐ Issue 2 — Sourcing of Apportionable Receipts. Receipts were properly sourced under RCW 82.04.462 because [____].

☐ Issue 3 — Resale Certificates. Certificates obtained from [____] are valid under RCW 82.04.470 / WAC 458-20-102 and exempt the underlying transactions from retailing B&O and retail sales tax.

☐ Issue 4 — Use Tax. The transactions are exempt under [RCW 82.12.____] because [____].

☐ Issue 5 — Nexus. Taxpayer lacked substantial nexus under RCW 82.04.067 / Wayfair v. South Dakota, 585 U.S. 162 (2018), for the periods [____] because [____].

☐ Issue 6 — Statute of Limitations. Portions of the assessment are barred by RCW 82.32.050.

☐ Issue 7 — Penalty Abatement. Penalties should be waived under RCW 82.32.105 (circumstances beyond Taxpayer's control) and ETA 3046.

☐ Issue 8 — Constitutional / ITFA / P.L. 86-272. [As applicable.]

VI. Documentary Support

Taxpayer attaches the following exhibits:

VII. Stay of Collection

Pursuant to RCW 82.32.200, Taxpayer requests that collection of the contested amount be stayed during the pendency of this Petition. Taxpayer [will post bond / is paying the contested tax under protest / requests waiver of bond under the small-claims exception, if applicable].

VIII. Relief Requested

Petitioner respectfully requests that the Appeals Division:

(a) Cancel the contested audit adjustments in the amount of $[______];
(b) Abate penalties of $[______];
(c) Refund any contested tax previously paid under protest with statutory interest;
(d) Issue a written Determination addressing each Issue raised; and
(e) Grant such other relief as is just.

IX. Certification

I certify under penalty of perjury under the laws of the State of Washington that the foregoing is true and correct.

Dated at [CITY], Washington, this ____ day of [MONTH], 20__.

________________________________
[NAME], [TITLE]
[For:] [TAXPAYER]

X. Filing Instructions

Mail:
Washington State Department of Revenue
Administrative Review and Hearings Division (Appeals)
PO Box 47460
Olympia, WA 98504-7460

Online: Submit through the Department's secure messaging within My DOR (https://secure.dor.wa.gov)

Part C — Appeal Cover Letter to the Board of Tax Appeals

Sender Letterhead

[LAW FIRM NAME]
[Street Address]
[City], Washington [ZIP]
Telephone: [(___) ___-____]
Email: [______________________]
WA Bar No.: [____________]

Date: [__/__/____]

VIA BTA E-FILING (https://bta.state.wa.us) AND CERTIFIED MAIL

Clerk of the Board
Washington State Board of Tax Appeals
1110 Capitol Way S., Suite 307
PO Box 40915
Olympia, WA 98504-0915

Re Block

Re: [TAXPAYER] v. Department of Revenue
Notice of Appeal — DOR Final Determination dated [__/__/____]
Docket No.: (to be assigned)
Tax type / period: [____________]
Amount in Controversy: $[__________]
Election: ☐ Formal Hearing ☐ Informal Hearing

Body

Dear Clerk:

Enclosed for filing with the Board of Tax Appeals are the following:

1. Notice of Appeal under RCW 82.03.190, appealing the Final Determination of the Department of Revenue's Appeals Division dated [__/__/____].
2. Copy of the DOR Final Determination.
3. Election of [Formal / Informal] hearing pursuant to WAC 456-09-010 / 456-10-010.
4. Filing fee of $[______] [or fee-waiver request].
5. Service Certification confirming service on the Department of Revenue and the Office of the Attorney General — Revenue Division.

Timeliness. The DOR Final Determination was mailed on [__/__/____]. This Notice of Appeal is filed on [__/__/____], within 30 calendar days as required by RCW 82.03.190 and WAC 456-10-310. Taxpayer understands that this deadline cannot be extended.

Statement of Errors. The DOR Final Determination errs by [BRIEFLY DESCRIBE — incorporating the issues raised in the Rule 100 Petition].

Pre-payment / Stay. Taxpayer [has paid the tax in full / is appealing without payment in reliance on the customary BTA stay practice / has posted bond under RCW 82.32.200]. Taxpayer requests confirmation of the stay status.

Respectfully submitted,

________________________________
[ATTORNEY NAME], Esq.
WSBA No. [__________]
Counsel for Appellant [TAXPAYER]

cc: Washington State Department of Revenue — Appeals Division
Office of the Attorney General — Revenue Division

Part D — Pre-Filing Checklist

Calendaring

☐ Audit assessment / Letter ID date: [__/__/____]
☐ Day 15 milestone (representative engaged; CTIA signed): [__/__/____]
☐ Day 20 milestone (extension request, if needed): [__/__/____]
☐ Day 30 Rule 100 Petition deadline (HARD): [__/__/____]
☐ DOR Final Determination received on: [__/__/____]
☐ Day 30 BTA Notice of Appeal deadline (HARD; cannot be extended): [__/__/____]
☐ For refund suit: tax paid in full on [__/__/____]; 4-year SOL under RCW 82.32.060: [__/__/____]

Petition Package — WAC 458-20-100(2) Required Contents

☐ Taxpayer name, address, UBI, phone, fax, email, contact
☐ Representative info + CTIA (REV 42 2446)
☐ Audit / assessment identification
☐ Amounts of tax, interest, penalties in controversy
☐ Type of review elected (Small Claims / Mainstream / Executive)
☐ Hearing preference (in-person / telephone / no hearing)
☐ Issue-by-issue statement of dispute with authorities cited
☐ Supporting documents and witness statements
☐ Signature / verification under penalty of perjury

Substantive Review

☐ Reviewed WBAQ responses (given great weight; cannot easily walk back)
☐ Reviewed audit narratives, sampling methodology, projections
☐ Reconciled book receipts to B&O taxable receipts
☐ Verified each B&O classification (retailing, wholesaling, manufacturing, service & other)
☐ Verified sourcing of apportionable receipts (RCW 82.04.462)
☐ Verified exemption / resale certificates per WAC 458-20-102
☐ Use-tax analysis: capital assets and consumables
☐ Confirmed nexus position (RCW 82.04.067; Wayfair)
☐ Identified P.L. 86-272 protections (limited application to WA B&O)
☐ Penalty waiver review (RCW 82.32.105; ETA 3046)
☐ Statute of limitations (RCW 82.32.050)

Collection / Cash Management

☐ Pay-vs.-bond decision under RCW 82.32.200
☐ Interest accrual tracked
☐ Refund-suit alternative considered (RCW 82.32.180 — Thurston County)
☐ Installment agreement evaluated (if hardship)

Service / Filing

☐ Rule 100 Petition mailed / portal-submitted within 30 days
☐ BTA Notice of Appeal filed within 30 days (e-filing through BTA portal)
☐ Service on DOR and AGO (Revenue Division)
☐ Filing fee paid

Sources and References

• WA DOR — Reviews and Appeals: https://dor.wa.gov/file-pay-taxes/reviews-and-appeals
• Rule 100 Further Appeal Rights (BTA 30 days): https://dor.wa.gov/file-pay-taxes/reviews-and-appeals/rule-100-further-appeal-rights
• WAC 458-20-100 (Rule 100 — Informal Administrative Reviews): https://apps.leg.wa.gov/wac/default.aspx?cite=458-20-100
• RCW 82.32.160 (review of assessments): https://app.leg.wa.gov/RCW/default.aspx?cite=82.32.160
• RCW 82.32.170 (reconsideration): https://app.leg.wa.gov/RCW/default.aspx?cite=82.32.170
• RCW 82.32.180 (superior court action): https://app.leg.wa.gov/RCW/default.aspx?cite=82.32.180
• RCW 82.32.200 (stay of collection / bond): https://app.leg.wa.gov/RCW/default.aspx?cite=82.32.200
• RCW 82.03.190 (BTA appeals): https://app.leg.wa.gov/RCW/default.aspx?cite=82.03.190
• WAC Chapter 456-09 / 456-10 (BTA procedural rules): https://apps.leg.wa.gov/wac/default.aspx?cite=456
• Washington State Board of Tax Appeals: https://bta.state.wa.us
• ETA 3046 (penalty waiver guidance): https://dor.wa.gov/laws-rules/excise-tax-advisories
• REV 42 2446 (Confidential Tax Information Authorization): https://dor.wa.gov/forms-publications (search CTIA)