Page 190 - Washington Nonprofit Handbook 2018 Edition

(c) Trade Shows, Conventions and Seminars

Nonprofit organizations may deduct attendance and space charges received

in connection with trade shows, conventions and seminars from the B&O tax if the
following conditions are satisfied:

• The sponsoring organization must be exempt under section 501 of the
Code;

• The sponsoring organization must either be a “trade organization” or a
“professional organization.” A “professional organization” is an entity
whose members are engaged in a particular lawful vocation,
occupation or field of activity of a specialized nature. A “trade
organization” is an entity whose members are engaged “in trade” (i.e.,
in one or more lawful commercial trades, businesses, crafts, industries
or distinct productive enterprises); and

• The event must not be open to the general public. This means that
(1) attendance is limited to members of the sponsoring organization
and to specific invited guests of the sponsoring organization; or (2) if
attendance is not limited to members and specifically invited guests,
all proceeds from the trade show, convention or seminar are subject
to B&O tax.

(d) Exemptions and Deductions for Specific Revenue
Streams

• Rents. Rents received from long-term leases of real property are
exempt from the B&O tax. Otherwise, rental income is likely subject to
the B&O tax. For example, short-term rentals by those who hold
themselves out to the public as hotels and motels are subject to the
Retailing B&O tax. In addition, the organization must collect the retail
sales tax and remit it to the state. Short-term rentals or other types of
real property are subject to the Service and Other Activities B&O tax;
and rentals of personal property are subject to the Retailing B&O tax,
and the organization must collect and remit the retail sales tax to the
state.

• Advancements and Reimbursements. Advancements and
reimbursements received by nonprofit organizations are excludable if
the organization receiving the reimbursement had no liability other

WASHINGTON NONPROFIT HANDBOOK -179- 2018