Article
Prepare for Washington’s new voluntary disclosure program for international sellers
Sept. 26, 2025 · Authored by Adam Cline, Wakako Byer
Washington State will launch a new voluntary disclosure program aimed at helping international sellers with unpaid Washington tax liabilities get into compliance on Feb. 1, 2026. This limited-time program offers a unique opportunity to settle outstanding debts with reduced penalties and without enforcement actions.
This is a unique and perhaps one-time opportunity to materially reduce tax liabilities, penalties, and interest — through reducing lookback periods — for international sellers that have nexus with the state and haven’t filed Washington tax returns to remit timely tax due.
Explore the program’s key features as well as its nexus and legal implications that can help you leverage this opportunity with the following insights.
Key program features
Although the new program has a degree of complexity, its key features include:
- Limited Window. The program will be open for only four months, encouraging international sellers to come forward promptly.
- Shorter Lookback. International sellers will need to address unpaid sales tax only for the past year, shorter than the typical three-to-five-year periods in other states. B&O tax remains applicable for the last four calendar years plus the current calendar year.
- Penalty Relief. The program offers potential penalty abatements, though interest on unpaid taxes still applies.
Understand nexus and legal implications
International sellers with sufficient legal connection for tax purposes with Washington State–referred to as nexus–are required to file tax returns with the state.
Washington recognizes several triggers for nexus that may subject international sellers to tax return filing responsibilities:
- Physical Presence. Ownership of property or presence of employees in the state may create nexus. The in-state transient presence of employees or independent contractors who establish or maintain a market on behalf of the international seller may also create nexus.
The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely. The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.