The Washington Department of Revenue (WADOR) announced on November 20, 2025 that it will launch a temporary International Remote Seller Voluntary Disclosure Program (VDP) and will accept applications from February 1, 2026 to May 31, 2026.
This program is for foreign remote businesses that are not registered with the WADOR and have established substantial nexus in Washington to require the business to register and report taxes to the State.
WHO QUALIFIES
A business must be headquartered outside the United States of America and meet all the following criteria:
- Has not had an active registration with or reported taxes to the WADOR within the current statutory period (four years plus the current year).
- Has not been contacted by the WADOR for enforcement purposes (for example, audit or compliance contacts regarding registration or reporting requirements) within the current statutory period.
- Has not engaged in evasion or misrepresentation in reporting tax liabilities.
BENEFITS OF THE VDP
If a business is discovered by the WADOR through normal investigation outside of a voluntary disclosure process, it may be liable for tax, interest, penalties of 39% of the tax due. And a lookback period of seven years plus the current year.
This new VDP provides remote sellers headquartered outside of the United States:
- The opportunity to voluntarily comply with the tax laws of Washington
- Reduce exposure to penalties
- Limit the lookback period for prior liabilities
A limited lookback period:
- Four years plus the current year for business and occupation (B&O) taxes.
- 12 months for uncollected retail sales tax.
Up to 39% in potential penalties can be waived, including:
- 5% assessment penalty for substantially underpaid tax.
- 5% unregistered penalty.
- 29% late payment of a return penalty.
The WADOR can summarize your unreported tax liability in a single tax assessment.
Please note that if a business has collected retail sales tax or use tax but did not remit this to the State, there is an unlimited look back period. And the 29% late payment penalty will apply only to the collected and unremitted retail sales or use tax amounts.
PREVIOUS OR CURRENTLY REGISTERED BUSINESSES
A business that was previously or is currently registered may not qualify for the VDP. However, it may qualify for a waiver of the 5% assessment penalty.
Businesses with an active registration who wish to report liability for periods prior to their original registration date may still qualify for VDP treatment. Provided the business meets all other requirements.
AFFILIATED ENTITIES AND SUBSIDIARIES
If you have unregistered affiliates, subsidiaries, or related entities organized outside the Unites States of America that are required to register and report, they are encouraged to come forward through the International Remote Seller VDP. A separate application must be filed for each business entity.
HOW TO APPLY
All requests for the VDP be submitted through the WADOR’s online application. Applicants are required to register with the WADOR by submitting a business license application.
Applicants should register with the WADOR after submitting the VDP application. Business license applications may be completed online.
Once approved, a formal International Remote Seller VDP agreement must be signed and returned within 30 days.
