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

the remaining conditions. See Rho, 113 Wn.2d at 569. Accordingly, we hold the superior court

did not err when it concluded that AMC did not pay onsite employees solely as an agent and the

payroll costs were not excludable under Rule 111.

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No. 60254-7-II

C. IMPUTATION OF INCOME

In the alternative, AMC alleges that it never “received” the funds in the operating accounts

used to pay onsite employees. Br. of Appellant at 32. AMC further argues that the only way to

conclude onsite employee wages are part of AMC’s gross income is to impute that income. We

disagree.

Here, AMC’s argument is premised on the assumption that its payment of the onsite

employee wages was not part of the “value proceeding or accruing from the property management

services.” Br. of Appellant at 33. However, as discussed in the foregoing analysis, AMC’s

employment of and payment to onsite employees is part of its “business engaged in.” RCW

82.04.080(1). AMC was responsible for providing comprehensive property management services

which, in AMC’s own words, includes “hiring, supervising, discharging, and compensating

workers on the [Owners’] property.” CP at 3. Although AMC’s employees were paid from

operating accounts containing funds belonging to the Owners, use of these funds to satisfy AMC’s

legal obligation to pay its own employees was “consideration” “actually received or accrued.”

RCW 82.04.090 (defining “value proceeding or accruing”). Accordingly, the onsite employee

wages constitute part of the “value proceeding or accruing” from AMC’s property management

services, which is subject to B&O tax. RCW 82.04.080; .220. That the onsite employees’ wages