Form Rev 40 0011 - Schedule B - Credit For Sales Taxes Paid On Bad Debts
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2State of Washington
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Department of Revenue
Attached To
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Taxpayer Account Administration
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PO Box 47476
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Olympia WA 98504-7476
______________________________, __________Tax Return
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REG.
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STREET ADDRESS
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CITY, STATE,
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CREDIT FOR SALES TAXES PAID ON BAD DEBTS
INSTRUCTIONS
1. Who Must File Schedule B
Schedule B should be used only when the rate of sales tax at the time of sale is different from the current rate on the tax
return. When the rates are still the same, a bad debt may be taken directly off the tax return as a regular deduction would be.
NOTE: DO NOT report the same bad debt as a retail sales tax deduction AND also as a credit listed on the Schedule B.
2. Bad Debts
a) To qualify as an allowable credit, the sale may have been made at any time and the state and local sales taxes remitted
to the Department during any prior reporting period.
b) If a debt has been collected in part, the uncollected amount, to the extent charged off the books, may be deducted.
c) Credit may only be claimed for sales taxes paid on identified transactions. Amounts established on the books as a
reserve for bad debts (reserve method of accounting) do not qualify. Credit may be claimed only once for each bad debt.
All credit claimed is subject to audit.
d) No refund or credit may be made for taxes, penalties, or interest paid more than four years prior to the beginning of
the calendar year in which a refund or credit application is made or examination of records by the Department is
completed.
Where a taxpayer has executed a written waiver of the limitations governing assessment under RCW 82.32.050 or
82.32.100, a refund or credit may be granted for taxes, penalties, or interest paid during, or attributable to, the years
covered by such waiver if, prior to expiration of the waiver period, an application for a refund or credit of such taxes,
penalties, or interest is made by the taxpayer or the Department discovers a refund or credit is due.
3. To Complete This Form
a) Block 1: Enter the reporting period you are attaching this schedule to.
b) Block 2: Enter the name and address of the business. IMPORTANT: YOU MUST WRITE IN YOUR WASHINGTON
STATE DEPARTMENT OF REVENUE REGISTRATION NUMBER.
c) Sales transactions should be grouped by date of sale and further sorted by location of sale (reference location code
list published by the Department of Revenue).
d) Column 1: Enter date of sale(s) as numeric month/year (e.g. 11/96).
e) Column 2: Enter the location code of sale. If sales were made during this month in multiple locations, use a different
line for each location code.
f)
Column 3: Enter the value of sales (excluding taxes and additional charges) claimed for bad debts for each
location code.
g) Column 6: Enter the total amount of state and local sales taxes paid to the state for each location code.
h) Columns 4 & 5: For each tax entry in column 6, break the tax amount into the state & local (include any King County
Food & Beverage and RTA) sales tax portions.
I)
If you need more space, use the back of this sheet. You may photo copy the form for more sheets. Write your
registration number on each page.
j)
Total all column 6 entries. Enter this amount in the “Total” block on this form and on the “BAD DEBT TAX CREDIT” line
on the Combined Excise Tax Return. Verify that the numbers are the same.
k) Attach Schedule B behind the Combined Excise Tax Return.
Column 1
Column 2
Column 3
Column 4
Column 5
Column 6
Date Of
Total State And
4 Digit
Value Of Sale
State Sales
Local Sales
For Department
For Department
Sale
Local Taxes
Location Code
Written Off
Tax Claimed
Tax Claimed
Use Only
Use Only
(MM/YY)
Claimed
SUB-TOTAL
Signature
COMBINED TOTAL
Post to BAD DEBT CREDIT line on
All sales taxes claimed:
Combined Excise Tax Return
Phone
REV 40 0011-1 (4-1-99)
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