Exemption List

Certain organization and business types are not required to obtain a Seattle business license or pay the business license tax. For an overview, see exemptions from the business license tax.

Exemptions: A to D

Accommodation sales

Certain accommodation sales are exempt from the Seattle business license tax.

Adult family homes

Licensed adult family homes are exempt from the Seattle business license tax.

Aid and relief organizations

Federally incorporated aid and relief organizations, such as the American Red Cross, are exempt from the Seattle business license tax.

Boxing and wrestling matches

State-licensed boxing and wrestling matches are exempt from the Seattle business license tax.

Casual sales

Casual sales are exempt from the Seattle business license tax. Casual sales are the infrequent sale of tangible goods that are not part of your typical business activity.

Certain hospitals and clinics

Certain government-funded or religiously-funded hospitals and clinics are exempt from the Seattle business license tax.

Commuter ride-sharing, carpool

Commuter ride-sharing or carpool funds are exempt from the Seattle business license tax. Funds from transporting those with special needs are exempt if in accordance with state law.

Credit unions

Credit unions are exempt from the Seattle business license tax.

Day care provided by churches

Day care services provided by churches are exempt from the Seattle business license tax.

Death benefits provided by fraternal organizations

Death benefits provided by fraternal and beneficiary organizations are exempt from the Seattle business license tax. This exemption is limited to certain organizations described in state law. And only gross income from insurance or death benefits is exempt.

Exemptions: E to K

Employees

Employees are exempt from the Seattle business license tax. Independent contractors are not exempt.

Farming

Agricultural product revenue earned by farmers is exempt from the Seattle business license tax.

Gasoline and other motor vehicle fuels

Selling, manufacturing and distributing gasoline, and other motor vehicle fuels, is exempt from the Seattle business license tax. However, fuels not subject to the state fuel excise tax are not exempt.

Gross receipts taxed under other Seattle Municipal Code (SMC) sections

Business activities that are taxed under SMC Chapter 5.48 or 5.52.030 B1 and B3 are exempt from the Seattle business license tax.

Health care plans

The premiums and prepayments of health care plans are exempt from the Seattle business license tax. The contractors and organizations that receive this exemption are specified by state law.

Horse racing

State-licensed horse races are exempt from the Seattle business license tax.

Insurance business

Certain insurance businesses are exempt from the Seattle business license tax.

International banking facilities

International banking facilities defined in the Seattle Municipal Code are exempt from the Seattle business license tax.

Investment revenue; dividends from subsidiary corporations

Investment revenue gained by individuals is exempt from the Seattle business license tax. However, investment revenue gained by financial businesses is not exempt.

Certain dividends are exempt if a parent corporation gains the dividend from its subsidiary. Some dividends, however, are subject to tax. These are specified in the Seattle Municipal Code.

Exemptions: L to Z

Liquor

State-sanctioned liquor sales are exempt from the Seattle business license tax.

Mortgage broker trust accounts

Revenue from trust accounts is exempt from the Seattle business license tax if the money is used by mortgage brokers to pay third-party costs.

Nonprofits: child care resource and referral services

Child-care resource and referral services provided by nonprofits are exempt from the Seattle business license tax.

Nonprofits: credit and debt services

Credit and debt services provided by nonprofits are exempt from the Seattle business license tax. These nonprofits provide credit and debt education. Or they work with lending agencies on behalf of the debtor.

Nonprofits: employment services for the handicapped or disabled

Nonprofits that provide employment services for the handicapped or disabled are exempt from the Seattle business license tax. These services are sometimes called sheltered workshops. State-funded group-training homes are also exempt.

Nonprofits: student loan services

Student loan services provided by nonprofits are exempt from the Seattle business license tax. These nonprofits issue debt to provide or acquire student loans. Or they provide guarantees for student loans.

Real estate commissions split between brokers

A portion of real estate commissions is exempt from the Seattle business license tax when the commission is divided among multiple brokers.

Sale of real estate, amounts derived

Real estate sale proceeds are exempt from the Seattle business license tax. However, commissions and similar real estate fees are not exempt.

Trust funds for other taxes

Amounts collected as trust funds are exempt from the Seattle business license tax. The taxpayer collects money in a trust fund on behalf of a third party. The funds satisfy the third party's obligation to pay retail sales tax, use tax, commercial parking tax, admission tax and other taxes.