Washington compliance for creators offering paid communities
Washington compliance for creators offering paid communities I ran multi-source web research focused on Washington-specific compliance for creators selling paid communities (subscriptions, memberships, paid Discord/Slack/Patreon/Substack-style offerings).
I scraped and reviewed Washington Department of Revenue guidance (digital products, digital entertainment, marketplace facilitators, B&O tax, business registration), Secretary of State LLC filing guidance, Washington unclaimed property guidance, the Washington data-breach statute (RCW 19.255.010), reporting on ESSB 5814 (the 2025 law expanding sales tax to many digital/IT/advertising services), and Washington Attorney General materials and commentary about automatic renewals and consumer-protection enforcement.
Below I summarize the relevant, state-specific compliance obligations, practical steps creators/LLC founders should take, and cite the authoritative sources used.Key findings and practical guidance (summary):1) Business registration and licensing- You must register with Washington Department of Revenue and obtain a Unified Business Identifier (UBI) / business license if you meet common thresholds: gross income $12,000+ per year in Washington or make taxable sales / plan to hire employees; out-of-state sellers must register if economic nexus thresholds are met (>$100,000 in Washington-sourced receipts) or you have physical presence. (DOR business license and nexus pages)- Also file entity formation with the Washington Secretary of State (LLC formation, annual reports) when operating as an LLC in WA.
I ran multi-source web research focused on Washington-specific compliance for creators selling paid communities (subscriptions, memberships, paid Discord/Slack/Patreon/Substack-style offerings). I scraped and reviewed Washington Department of Revenue guidance (digital products, digital entertainment, marketplace facilitators, B&O tax, business registration), Secretary of State LLC filing guidance, Washington unclaimed property guidance, the Washington data-breach statute (RCW 19.255.010), reporting on ESSB 5814 (the 2025 law expanding sales tax to many digital/IT/advertising services), and Washington Attorney General materials and commentary about automatic renewals and consumer-protection enforcement.
Below I summarize the relevant, state-specific compliance obligations, practical steps creators/LLC founders should take, and cite the authoritative sources used.Key findings and practical guidance (summary):1) Business registration and licensing- You must register with Washington Department of Revenue and obtain a Unified Business Identifier (UBI) / business license if you meet common thresholds: gross income $12,000+ per year in Washington or make taxable sales / plan to hire employees; out-of-state sellers must register if economic nexus thresholds are met (>$100,000 in Washington-sourced receipts) or you have physical presence. (DOR business license and nexus pages)- Also file entity formation with the Washington Secretary of State (LLC formation, annual reports) when operating as an LLC in WA.
Sales tax vs. B&O tax for digital subscriptions and paid communities- Washington treats many digital products and digital entertainment subscriptions as taxable retail sales; retail sales tax applies to digital entertainment subscription fees and sellers with subscribers in WA must collect retail sales tax and also pay retailing B&O tax if they have nexus. (DOR digital entertainment, digital products pages)- B&O tax is a gross receipts tax applied on the gross income of business activity—no deduction for costs; classification (retailing, services, royalties, etc.) affects which B&O rate applies. (DOR B&O tax page) ESSB 5814 (2025) — expansion of sales tax base- ESSB 5814 expanded Washington’s retail sales tax and retailing B&O tax effective Oct 1, 2025 to include many digital advertising, IT and related services and narrowed exclusions for digital automated services.
This change materially increases the types of digital services that can be taxable (including some services creators may provide). Review the DOR interim guidance for examples and sourcing rules. (DOR guidance, Avalara/Cherry Bekaert summaries)4) Marketplace facilitators & platform sales- Marketplace facilitator rules require marketplace operators (platforms that facilitate sales) to collect and remit sales tax on facilitated sales in many cases; facilitators must register if they exceed $100k or have nexus and must provide monthly reports to sellers.
If you sell via platforms (Patreon, Gumroad, Substack, app stores), verify whether the platform collects WA tax on your sales or if you’re responsible. (DOR marketplace facilitator page) Consumer protection, automatic renewals, and refund/cancellation disclosures- Washington authorities (Attorney General) have signaled enforcement attention on unclear auto-renewal/recurring billing practices.
Washington legislative activity and proposed/ enacted provisions require clear and conspicuous disclosure of automatic renewal terms; failure can render renewal provisions unenforceable and invite AG actions.
Ensure subscription terms, pricing, renewal periods, cancellation steps, and any increases are disclosed before purchase and in renewal reminder notices as required. (Washington AG activity / reporting and legislative materials) Privacy and breach notification- Washington’s breach-notification statute (RCW 19.255.010) requires businesses conducting business in the state that own or license personal information to disclose breaches to Washington residents and to the AG when personal data are involved—notice must be made expediently and generally within 30 days of discovery.
Creators collecting member personal information should implement security practices and a breach response plan. (RCW 19.255.010)7) Other compliance areas- Unclaimed property holders must report and remit unclaimed property to WA (DOR administers UCP).
If you hold customer funds, refunds, gift balances, or unclaimed accounts, follow WA unclaimed property rules. (WA Unclaimed Property)- Local business licenses: cities/counties may require local business licenses or endorsements—check city requirements where you have physical presence or employees.Practical checklist for creators/LLC founders in Washington- Register: Apply for a business license / UBI with DOR; form an LLC with WA Secretary of State if desired.- Determine nexus: evaluate physical presence and economic nexus (>$100,000 WA-sourced) for sales tax / B&O obligations.- Classify offerings: map paid community subscriptions to DOR categories (digital entertainment, digital automated services, live presentations, custom software access) to decide taxability.- Tax collection: set up sales tax collection if required; confirm whether platforms/facilitators collect WA sales tax for you.
Track sourcing (customer address) for rate determination.- File & pay B&O tax: register for B&O and remit based on classification and filing frequency.- Consumer-facing policies: update Terms of Service and checkout disclosures to comply with automatic renewal rules and AG expectations (clear pricing, renewal notice, easy cancellation method, refund policies).- Privacy & security: limit collection of sensitive personal data, adopt a breach response plan, and comply with WA breach notification law (RCW 19.255.010).- Reporting & other obligations: comply with unclaimed property reporting, employment obligations if hiring, and local business license rules.- Professional help: consult a Washington tax specialist and business attorney to classify services, implement sales tax automation, and update contracts.Next steps to turn this research into the requested deliverables- I can now draft the comprehensive blog post, including: state overview, registration steps, tax treatment of paid communities (with examples for Patreon/Substack/Discord subscriptions), ESSB 5814 implications, marketplace/platform scenarios, consumer-protection/automatic-renewal best practices and sample disclosure language, privacy/breach checklist, unclaimed property note, and an action-oriented compliance checklist for LLC founders.
I will cite the Washington DOR, RCWs, Secretary of State, AG guidance, and other authoritative sources.
Washington compliance for creators offering paid communities I ran multi-source web research focused on Washington-specific compliance for creators selling paid communities (subscriptions, memberships, paid Discord/Slack/Patreon/Substack-style offerings).
I scraped and reviewed Washington Department of Revenue guidance (digital products, digital entertainment, marketplace facilitators, B&O tax, business registration), Secretary of State LLC filing guidance, Washington unclaimed property guidance, the Washington data-breach statute (RCW 19.255.010), reporting on ESSB 5814 (the 2025 law expanding sales tax to many digital/IT/advertising services), and Washington Attorney General materials and commentary about automatic renewals and consumer-protection enforcement.
Below I summarize the relevant, state-specific compliance obligations, practical steps creators/LLC founders should take, and cite the authoritative sources used.Key findings and practical guidance (summary):1) Business registration and licensing- You must register with Washington Department of Revenue and obtain a Unified Business Identifier (UBI) / business license if you meet common thresholds: gross income $12,000+ per year in Washington or make taxable sales / plan to hire employees; out-of-state sellers must register if economic nexus thresholds are met (>$100,000 in Washington-sourced receipts) or you have physical presence. (DOR business license and nexus pages)- Also file entity formation with the Washington Secretary of State (LLC formation, annual reports) when operating as an LLC in WA.
I ran multi-source web research focused on Washington-specific compliance for creators selling paid communities (subscriptions, memberships, paid Discord/Slack/Patreon/Substack-style offerings). I scraped and reviewed Washington Department of Revenue guidance (digital products, digital entertainment, marketplace facilitators, B&O tax, business registration), Secretary of State LLC filing guidance, Washington unclaimed property guidance, the Washington data-breach statute (RCW 19.255.010), reporting on ESSB 5814 (the 2025 law expanding sales tax to many digital/IT/advertising services), and Washington Attorney General materials and commentary about automatic renewals and consumer-protection enforcement.
Below I summarize the relevant, state-specific compliance obligations, practical steps creators/LLC founders should take, and cite the authoritative sources used.Key findings and practical guidance (summary):1) Business registration and licensing- You must register with Washington Department of Revenue and obtain a Unified Business Identifier (UBI) / business license if you meet common thresholds: gross income $12,000+ per year in Washington or make taxable sales / plan to hire employees; out-of-state sellers must register if economic nexus thresholds are met (>$100,000 in Washington-sourced receipts) or you have physical presence. (DOR business license and nexus pages)- Also file entity formation with the Washington Secretary of State (LLC formation, annual reports) when operating as an LLC in WA.
Sales tax vs. B&O tax for digital subscriptions and paid communities- Washington treats many digital products and digital entertainment subscriptions as taxable retail sales; retail sales tax applies to digital entertainment subscription fees and sellers with subscribers in WA must collect retail sales tax and also pay retailing B&O tax if they have nexus. (DOR digital entertainment, digital products pages)- B&O tax is a gross receipts tax applied on the gross income of business activity—no deduction for costs; classification (retailing, services, royalties, etc.) affects which B&O rate applies. (DOR B&O tax page) ESSB 5814 (2025) — expansion of sales tax base- ESSB 5814 expanded Washington’s retail sales tax and retailing B&O tax effective Oct 1, 2025 to include many digital advertising, IT and related services and narrowed exclusions for digital automated services.
This change materially increases the types of digital services that can be taxable (including some services creators may provide). Review the DOR interim guidance for examples and sourcing rules. (DOR guidance, Avalara/Cherry Bekaert summaries)4) Marketplace facilitators & platform sales- Marketplace facilitator rules require marketplace operators (platforms that facilitate sales) to collect and remit sales tax on facilitated sales in many cases; facilitators must register if they exceed $100k or have nexus and must provide monthly reports to sellers.
If you sell via platforms (Patreon, Gumroad, Substack, app stores), verify whether the platform collects WA tax on your sales or if you’re responsible. (DOR marketplace facilitator page) Consumer protection, automatic renewals, and refund/cancellation disclosures- Washington authorities (Attorney General) have signaled enforcement attention on unclear auto-renewal/recurring billing practices.
Washington legislative activity and proposed/ enacted provisions require clear and conspicuous disclosure of automatic renewal terms; failure can render renewal provisions unenforceable and invite AG actions.
Ensure subscription terms, pricing, renewal periods, cancellation steps, and any increases are disclosed before purchase and in renewal reminder notices as required. (Washington AG activity / reporting and legislative materials) Privacy and breach notification- Washington’s breach-notification statute (RCW 19.255.010) requires businesses conducting business in the state that own or license personal information to disclose breaches to Washington residents and to the AG when personal data are involved—notice must be made expediently and generally within 30 days of discovery.
Creators collecting member personal information should implement security practices and a breach response plan. (RCW 19.255.010)7) Other compliance areas- Unclaimed property holders must report and remit unclaimed property to WA (DOR administers UCP).
If you hold customer funds, refunds, gift balances, or unclaimed accounts, follow WA unclaimed property rules. (WA Unclaimed Property)- Local business licenses: cities/counties may require local business licenses or endorsements—check city requirements where you have physical presence or employees.Practical checklist for creators/LLC founders in Washington- Register: Apply for a business license / UBI with DOR; form an LLC with WA Secretary of State if desired.- Determine nexus: evaluate physical presence and economic nexus (>$100,000 WA-sourced) for sales tax / B&O obligations.- Classify offerings: map paid community subscriptions to DOR categories (digital entertainment, digital automated services, live presentations, custom software access) to decide taxability.- Tax collection: set up sales tax collection if required; confirm whether platforms/facilitators collect WA sales tax for you.
Track sourcing (customer address) for rate determination.- File & pay B&O tax: register for B&O and remit based on classification and filing frequency.- Consumer-facing policies: update Terms of Service and checkout disclosures to comply with automatic renewal rules and AG expectations (clear pricing, renewal notice, easy cancellation method, refund policies).- Privacy & security: limit collection of sensitive personal data, adopt a breach response plan, and comply with WA breach notification law (RCW 19.255.010).- Reporting & other obligations: comply with unclaimed property reporting, employment obligations if hiring, and local business license rules.- Professional help: consult a Washington tax specialist and business attorney to classify services, implement sales tax automation, and update contracts.Next steps to turn this research into the requested deliverables- I can now draft the comprehensive blog post, including: state overview, registration steps, tax treatment of paid communities (with examples for Patreon/Substack/Discord subscriptions), ESSB 5814 implications, marketplace/platform scenarios, consumer-protection/automatic-renewal best practices and sample disclosure language, privacy/breach checklist, unclaimed property note, and an action-oriented compliance checklist for LLC founders.
I will cite the Washington DOR, RCWs, Secretary of State, AG guidance, and other authoritative sources.
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