- Washington Department of Revenue determined an out-of-state company had substantial nexus in Washington.
- The company used local contractors for water mitigation services for insurance claims.
- The company argued it only provided administrative services and lacked physical presence in Washington.
- The Department ruled the company had nexus due to in-state activities linked to market maintenance.
- The company’s referral network and oversight of local providers were key to fulfilling contracts.
- The company assumed warranty obligations, establishing its role as a seller.
- The ruling emphasized that third-party contractors can create nexus for tax obligations.
- Businesses should evaluate third-party relationships as they can establish nexus without physical presence.
Source: salestaxinstitute.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
