Smart Building, Smart Saving: Navigating the WA DOR Sales Tax Deferral Program

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Smart Building, Smart Saving: Navigating the WA DOR Sales Tax Deferral Program (Webinar)

 

 

 

 

 

 

Washington State’s Sales Tax Deferral Program is a powerful incentive for manufacturers and research & development businesses looking to build or expand in counties with populations under 650,000—which includes most of the state. Although it’s called a deferral program, it actually functions as a tax waiver. Once your qualifying project is complete, you’ll meet annual requirements over an eight-year period, and each year, 12.5% of the deferred sales tax is permanently waived.

Program Highlights:
•    Available in most Washington counties (population under 650,000)
•    Applies to qualifying buildings and equipment
•    Up to $400,000 in sales tax can be deferred and ultimately waived
•    Tax is waived in 1/8 increments annually over 8 years
•    Ideal for projects costing $4.5 to $5 million, depending on local tax rates

Example Scenario:
A furniture manufacturer builds a $5 million facility in Mount Vernon. With an 8.8% sales tax rate, the total tax would be $440,000. Under the program, $400,000 of that tax is deferred and eventually waived—resulting in significant long-term savings.

For Contractors:
•    You’ll receive a deferral certificate from the taxpayer—this means you do not charge sales tax on qualifying purchases.
•    The certificate is only valid for the applicant’s purchases, not the contractor’s.
•    When reporting to the Department of Revenue, you deduct the sales tax amount to explain why it wasn’t collected.
•    No changes to your workflow—just a simple reporting adjustment.

Meet Your Program Expert – Debi Brower:
With 35 years at the Department of Revenue and 21 years dedicated to administering tax deferral programs, Debi is passionate about helping businesses save money. She currently oversees programs supporting manufacturing, R&D, multifamily housing, clean technology, and solar canopy projects.

If you’re planning a qualifying project, this is your chance to maximize your investment and minimize your tax burden. Don’t miss out—register today and take advantage of one of Washington’s most impactful business incentives.

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