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Certain nonprofit youth organizations are exempt from business and occupation (B&O) tax and do not have to collect sales tax on membership fees or dues for recreational services provided to their members.
To qualify for these exemptions, the nonprofit youth organization must be both:
- A nonprofit organization engaged in the character building of youth (“character building” is defined as “activities for children under eighteen years of age that are for the general public's good. The activities may build, improve, or enhance a child's moral constitution by developing moral or ethical strength, leadership, integrity, self-discipline, fortitude, self-esteem, and reputation).
- An organization that is exempt or eligible to be exempt from property tax under RCW 84.36.030.
If the nonprofit youth organization does not meet the eligibility requirements, the income is taxable.
More information
RCW 82.04.4271 Deductions – Membership fees and certain services by nonprofit youth organization.
RCW 82.08.0291 Exemptions – Sales of amusement and recreation services of personal services by nonprofit youth organization – Local government physical fitness classes.
