This is your annual reminder that if you reported under the Service and Other Activities classification or if you have apportionable income or royalty income in Washington State, do not forget that the Annual Reconciliation of Apportionable Income is due by Tuesday, October 31, or you could be facing a 29-percent penalty.
The annual reconciliation form trues up your Washington apportionment calculation for the calendar year. If there is a difference, the taxpayer is either due a refund or owes additional tax and interest. The Washington Department of Revenue takes the position that the 29-percent late payment penalty can apply if a taxpayer merely fails to file the reconciliation form. To avoid the penalty risk, the return must be filed and any tax due must be paid by the deadline. However, even if no tax is due, the best practice is for taxpayers to file the form to avoid the potential 29-percent late payment penalty on any future assessments.
For additional information, visit the Department's website for step-by-step guidance. Under "My DOR Help" > "Special Credits: Apply and reconcile: File Annual Apportionment Reconciliation."
Please reach out if you have questions about whether your activities are apportionable, how to apportion (including the apportionment formula or throw-out income), how your income should be attributed, or whether you are eligible for any deductions.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.