Many tax-exempt organizations in Washington are still subject to business and occupation tax at both the state and local level. For B&O tax purposes, nonprofit organizations are generally presumed taxable in the same manner as for profit organizations.
Once a potential founder has read our post on Nonprofit Business Planning “ Steal All the Underpants, and has determined that a new nonprofit organization would serve a legitimate need in the community and can be supported without stealing any underpants, she must then consider the steps necessary to form the nonprofit corporation in Washington State and obtain tax-exemption from the IRS.
An often overlooked aspect of corporate law is the concept of doing business in a particular jurisdiction. This determination comes into play when the corporation’s activities go beyond the borders of its home state or domicile.