Wash. Court of Appeals published opinion — D2 60254-7-II Published Opinion.pdf

Citation: Wash. Court of Appeals published opinion — D2 60254-7-II Published Opinion.pdf
Jurisdiction: Washington (state)
Source: Official source
Original Source: https://www.courts.wa.gov/opinions/pdf/D2%2060254-7-II%20Published%20Opinion.pdf ↗

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the value proceeding or accruing by reason of the transaction of the business
engaged in and includes gross proceeds of sales, compensation for the rendition of
services, gains realized from trading in stocks, bonds, or other evidences of
indebtedness, interest, discount, rents, royalties, fees, commissions, dividends, and
other emoluments however designated, all without any deduction on account of the
cost of tangible property sold, the cost of materials used, labor costs, interest,

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For the current opinion, go to https://www.lexisnexis.com/clients/wareports/.

No. 60254-7-II

AMC alleged “[a]llowing [the Department] to impute income, reject Rule 111 exclusion, or

interpret RCW 82.04.080 to include funds owned by the Owner and over which AMC has no

discretion or control likely violates . . . [the Fourteenth Amendment].” CP at 25.

The Department also filed a motion for summary judgment. The Department argued that

(1) the payroll costs for onsite employees were part of AMC’s gross income subject to B&O tax

and (2) AMC was not entitled to exclude the payroll costs under Rule 111 because AMC could not

meet the conditions of the rule.

After a hearing on the motions, the superior court determined that (1) there were no genuine

issues of material fact, (2) AMC was the employer of the onsite employees, and (3) AMC did not

pay the onsite employee wages in an agent capacity. The superior court concluded that the onsite

employee wages were part of AMC’s business gross income subject to B&O tax and not

excludable under Rule 111. Accordingly, the superior court denied AMC’s motion for summary

judgment and granted summary judgment in favor of the Department.

AMC appeals.

ANALYSIS