Washington B&O tax

Retailing vs. wholesaling B&O for contractors.

Washington's Business & Occupation tax is generally based on gross receipts, not profit. The classification depends on the activity.

Rates used by this calculator

Classification	Rate	Typical simplified contractor use
Retailing	0.471% (.00471)	Prime/custom construction performed for the consumer
Wholesaling	0.484% (.00484)	Qualifying subcontract work sold for resale when proper reseller-permit documentation is provided

The calculator applies these rates to the contract amount as a planning estimate.

B&O is not a profit tax

A contractor can owe B&O tax even on a low-margin job because the tax is generally measured from gross receipts under the applicable classification, subject to deductions and credits that may apply.

Example: on $18,500 of retailing gross receipts, 0.471% produces an estimated B&O amount of $87.14 before considering any applicable deductions or credits.

Why classification matters

Washington construction can fall under retailing, wholesaling, public road construction, government contracting or other classifications depending on who owns the property, who hired the contractor and what work is being performed. A subcontractor without valid wholesale documentation may be treated differently from one with a valid reseller permit.

Calculator limitation: it does not model every deduction, credit, municipal tax, payroll tax, workers' compensation cost, federal tax or project-specific classification. Use it for job-planning estimates, not as a tax return.

Primary reference: WA DOR B&O Tax Classifications.