Washington compliance for affiliate-style creators

Washington compliance for affiliate-style creators Research steps taken and summary of findings:Steps taken Research steps taken and summary of findings:Steps taken Per instructions I ran a multi-step web search (functions.search_and_extract_tool) for Washington-specific compliance issues affecting affiliate-style creators (affiliate marketers, influencers, creators) including tax (B&O and sales/use tax), advertising services changes, business registration, FTC disclosure rules, and practical compliance steps.

I fetched and extracted authoritative documents and guidance from Washington Department of Revenue (DOR) and the Washington State Legislature (ESSB 5814 bill summary), and from the Federal Trade Commission (FTC) guidance for social media influencers. 3) I reviewed the DOR interim guidance on ESSB 5814 (advertising services), the DOR business & occupation tax overview, the legislative bill summary for ESSB 5814, and the FTC’s Disclosures 101 for Social Media Influencers.

Key findings (concise, Washington-specific, practical) - ESSB 5814 and DOR guidance (Washington): Washington revised its tax code in 2025 such that the sale of “advertising services” is treated as a retail sale subject to Washington retailing B&O tax and retail sales tax for transactions that are not for resale.

DOR’s interim guidance explains the definition of “advertising services” (explicitly including online referrals, search engine marketing, lead generation optimization, web campaign planning, and monitoring/evaluation of website traffic) and provides sourcing rules, examples, exclusions, and recordkeeping requirements.

DOR’s guidance makes clear sellers may need to collect and remit retail sales tax on advertising services and report gross receipts under the retailing B&O classification where applicable. - B&O tax basics (Washington): Washington’s B&O tax is a gross receipts tax measured on gross income from business activities (no deductions for labor, materials, taxes, etc.).

Creators/affiliates earning commissions, referral fees, or other gross receipts from business activities generally must report those receipts for B&O tax purposes (classification depends on activity). - Sourcing and the MPU (multiple points of use): DOR’s interim guidance explains that advertising services are sourced to the location where the purchaser receives the service (destination-based rules) and provides default sourcing rules when the location is unknown.

The MPU exemption and allocation rules may apply for services used concurrently inside and outside Washington; DOR requires documentation and apportionment methods supported by records. - Documentation and classification: DOR emphasizes classifying services based on information available at contract execution, keeping suitable records (contracts, invoices, targeting data, IP/geolocation or ZIP lookups), and the possibility of reclassification (which can affect tax treatment and refunds). - Federal (FTC) disclosure obligations for influencers/affiliates: Independently of Washington tax rules, the FTC requires clear disclosures of any “material connection” with brands (financial or other valuable consideration).

Disclosures must be placed so they are hard to miss, use plain language (e.g., “ad”, “sponsored”, “#ad”), appear in the endorsement message (not buried in a profile/about page), and be visible in video/audio/live contexts (repeated as needed).

U.S. law applies to posts reasonably expected to affect U.S. consumers. Practical compliance checklist for affiliate-style creators with activity tied to Washington: Determine business structure and register properly register your business with Washington (UBI) and DOR if you have Washington operations or expect Washington-source receipts. (Washington DOR/BLS registration steps should be checked via DOR/BLS sites.) Treat affiliate commissions and referral fees as business gross receipts report them for B&O tax classification that best fits the activity; consult DOR guidance if you’re unsure whether income is “advertising services” versus other services or wholesaling/resale.

If you sell advertising services (including online referrals, search engine marketing, lead generation, or if you run ad placements for clients), evaluate whether retail sales tax must be collected and remit retailing B&O tax on gross receipts—ESSB 5814 and DOR interim guidance make these taxable where not for resale.

Source sales correctly collect evidence (buyer address, targeting data, IP lookups, nine-digit ZIPs) to properly source advertising service receipts to WA or other jurisdictions per DOR rules; use pool codes where permitted and avoid bad-faith sourcing.

Use MPU/direct-pay correctly if purchaser claims multiple points of use exemption or direct-pay permit, follow DOR procedures and retain certificate/documentation. Maintain thorough records contracts, SOWs, invoices, targeting and impression/location data, reseller or exemption certificates, and allocation methodology.

FTC compliance always disclose material connections clearly and prominently on the platform where endorsement occurs (in-content disclosure), using plain language (e.g., “#ad”, “sponsored”), ensuring visibility in images/videos/live streams.

Get professional help where uncertain for nexus/affiliate-nexus exposures, cross-state activity, or ambiguous classification, consult a CPA or tax attorney; consider voluntary disclosure if prior periods might be at risk.

Next steps I recommend before I draft the full blog/newsletter content: - Confirm whether the creator’s activities fit the DOR definition of “advertising services” (ask for specific business models: selling ad placements, providing optimization/lead-gen, referral links, or earning affiliate commissions). - Collect example scenarios from the user (typical revenue streams, whether they operate a marketplace, use third-party platforms, or place ads for clients) so I can produce tailored, state-specific compliance guidance and step-by-step checklists.

Citations and verbatim excerpts used to reach these conclusions: Washington Department of Revenue — Interim guidance changes made by ESSB 5814 for Advertising ServicesCitation: https://dor.wa.gov/laws-rules/interim_guidance_statements/interim-guidance-statement-regarding-changes-made-essb-5814-advertising-servicesExcerpts:- "Effective October 1, 2025, Engrossed Substitute Senate Bill 5814, Laws of 2025, Chapter 422 (ESSB 5814) makes the sale of advertising services a retail sale subject to Washington’s retailing business and occupation (B&O) tax and retail sales tax."- "ESSB 5814 defines 'advertising services' to mean: All digital and nondigital services related to the creation, preparation, production, or dissemination of advertisements including, but not limited to: (A) Layout, art direction, graphic design, mechanical preparation, production supervision, placement, referrals, acquisition of advertising space, and rendering advice concerning the best methods of advertising products or services; and (B) Online referrals, search engine marketing, and lead generation optimization, web campaign planning, the acquisition of advertising space in the internet media, and the monitoring and evaluation of website traffic for purposes of determining the effectiveness of an advertising campaign."- "Advertising services are subject to tax based on the location where the services are received by the purchaser and other default sourcing rules as follows..."- "As required under RCW 82.32.070, sellers and purchasers of advertising services must keep and preserve suitable records to determine the amount of tax, including documentation necessary for sourcing sales..." Washington Department of Revenue — Business & occupation (B&O) tax overviewCitation https://dor.wa.gov/taxes-rates/business-occupation-taxExcerpts:- "The state B&O tax is a gross receipts tax.

It is measured on the value of products, gross proceeds of sale, or gross income of the business."- "Washington, unlike many other states, does not have an income tax. Washington’s B&O tax is calculated on the gross income from activities.

This means there are no deductions from the B&O tax for labor, materials, taxes, or other costs of doing business." Washington State Legislature — ESSB 5814 bill summaryCitation https://app.leg.wa.gov/billsummary/?BillNumber=5814&Year=2025Excerpts:- "Revised for 1st substitute: Modifying the application and administration of certain excise taxes."- "Engrossed substitute - ESSB 5814 ...

Chapter 422, 2025 Laws ... Effective date 7/27/2025*."(Note: DOR interim guidance clarifies effective timing for advertising services provisions as October 1, 2025—use the DOR guidance for operational taxability timing and details.)4) Federal Trade Commission — Disclosures 101 for Social Media InfluencersCitation: https://www.ftc.gov/business-guidance/resources/disclosures-101-social-media-influencersExcerpts:- "Do you work with brands to recommend or endorse products?

If so, you need to comply with the law when making these recommendations. One key is to make a good disclosure of your relationship to the brand."- "Disclose when you have any financial, employment, personal, or family relationship with a brand."- "Make sure people will see and understand the disclosure.

Place it so it’s hard to miss. The disclosure should be placed with the endorsement message itself."- "Use simple and clear language... terms like 'advertisement,' 'ad,' and 'sponsored.'"If you’re ready, I can now draft the full, SEO-optimized blog post and newsletter copy (with Washington-specific sections, practical checklists, example scenarios, and suggested next actions) based on this research.

If you want the guidance tailored to a specific creator scenario (sole proprietor vs. WA-LLC, ad-sales vs. affiliate commissions, platform-based marketplace sales, or influencer for brands), tell me which scenario(s) to prioritize and I’ll produce the final content.

Washington compliance for affiliate-style creators Research steps taken and summary of findings:Steps taken Research steps taken and summary of findings:Steps taken Per instructions I ran a multi-step web search (functions.search_and_extract_tool) for Washington-specific compliance issues affecting affiliate-style creators (affiliate marketers, influencers, creators) including tax (B&O and sales/use tax), advertising services changes, business registration, FTC disclosure rules, and practical compliance steps.

I fetched and extracted authoritative documents and guidance from Washington Department of Revenue (DOR) and the Washington State Legislature (ESSB 5814 bill summary), and from the Federal Trade Commission (FTC) guidance for social media influencers. 3) I reviewed the DOR interim guidance on ESSB 5814 (advertising services), the DOR business & occupation tax overview, the legislative bill summary for ESSB 5814, and the FTC’s Disclosures 101 for Social Media Influencers.

Key findings (concise, Washington-specific, practical) - ESSB 5814 and DOR guidance (Washington): Washington revised its tax code in 2025 such that the sale of “advertising services” is treated as a retail sale subject to Washington retailing B&O tax and retail sales tax for transactions that are not for resale.

DOR’s interim guidance explains the definition of “advertising services” (explicitly including online referrals, search engine marketing, lead generation optimization, web campaign planning, and monitoring/evaluation of website traffic) and provides sourcing rules, examples, exclusions, and recordkeeping requirements.

DOR’s guidance makes clear sellers may need to collect and remit retail sales tax on advertising services and report gross receipts under the retailing B&O classification where applicable.

- Federal (FTC) disclosure obligations for influencers/affiliates: Independently of Washington tax rules, the FTC requires clear disclosures of any “material connection” with brands (financial or other valuable consideration).

Disclosures must be placed so they are hard to miss, use plain language (e.g., “ad”, “sponsored”, “#ad”), appear in the endorsement message (not buried in a profile/about page), and be visible in video/audio/live contexts (repeated as needed).

U.S. law applies to posts reasonably expected to affect U.S. consumers. Practical compliance checklist for affiliate-style creators with activity tied to Washington: Determine business structure and register properly register your business with Washington (UBI) and DOR if you have Washington operations or expect Washington-source receipts. (Washington DOR/BLS registration steps should be checked via DOR/BLS sites.) Treat affiliate commissions and referral fees as business gross receipts report them for B&O tax classification that best fits the activity; consult DOR guidance if you’re unsure whether income is “advertising services” versus other services or wholesaling/resale.

If you sell advertising services (including online referrals, search engine marketing, lead generation, or if you run ad placements for clients), evaluate whether retail sales tax must be collected and remit retailing B&O tax on gross receipts—ESSB 5814 and DOR interim guidance make these taxable where not for resale.

Source sales correctly collect evidence (buyer address, targeting data, IP lookups, nine-digit ZIPs) to properly source advertising service receipts to WA or other jurisdictions per DOR rules; use pool codes where permitted and avoid bad-faith sourcing.

Use MPU/direct-pay correctly if purchaser claims multiple points of use exemption or direct-pay permit, follow DOR procedures and retain certificate/documentation. Maintain thorough records contracts, SOWs, invoices, targeting and impression/location data, reseller or exemption certificates, and allocation methodology.

FTC compliance always disclose material connections clearly and prominently on the platform where endorsement occurs (in-content disclosure), using plain language (e.g., “#ad”, “sponsored”), ensuring visibility in images/videos/live streams.

Get professional help where uncertain for nexus/affiliate-nexus exposures, cross-state activity, or ambiguous classification, consult a CPA or tax attorney; consider voluntary disclosure if prior periods might be at risk.

Next steps I recommend before I draft the full blog/newsletter content:

- Collect example scenarios from the user (typical revenue streams, whether they operate a marketplace, use third-party platforms, or place ads for clients) so I can produce tailored, state-specific compliance guidance and step-by-step checklists.

Citations and verbatim excerpts used to reach these conclusions: Washington Department of Revenue — Interim guidance changes made by ESSB 5814 for Advertising ServicesCitation: https://dor.wa.gov/laws-rules/interim_guidance_statements/interim-guidance-statement-regarding-changes-made-essb-5814-advertising-servicesExcerpts:- "Effective October 1, 2025, Engrossed Substitute Senate Bill 5814, Laws of 2025, Chapter 422 (ESSB 5814) makes the sale of advertising services a retail sale subject to Washington’s retailing business and occupation (B&O) tax and retail sales tax."- "ESSB 5814 defines 'advertising services' to mean: All digital and nondigital services related to the creation, preparation, production, or dissemination of advertisements including, but not limited to: (A) Layout, art direction, graphic design, mechanical preparation, production supervision, placement, referrals, acquisition of advertising space, and rendering advice concerning the best methods of advertising products or services; and (B) Online referrals, search engine marketing, and lead generation optimization, web campaign planning, the acquisition of advertising space in the internet media, and the monitoring and evaluation of website traffic for purposes of determining the effectiveness of an advertising campaign."- "Advertising services are subject to tax based on the location where the services are received by the purchaser and other default sourcing rules as follows..."- "As required under RCW 82.32.070, sellers and purchasers of advertising services must keep and preserve suitable records to determine the amount of tax, including documentation necessary for sourcing sales..." Washington Department of Revenue — Business & occupation (B&O) tax overviewCitation https://dor.wa.gov/taxes-rates/business-occupation-taxExcerpts:- "The state B&O tax is a gross receipts tax.

It is measured on the value of products, gross proceeds of sale, or gross income of the business."- "Washington, unlike many other states, does not have an income tax. Washington’s B&O tax is calculated on the gross income from activities.

This means there are no deductions from the B&O tax for labor, materials, taxes, or other costs of doing business." Washington State Legislature — ESSB 5814 bill summaryCitation https://app.leg.wa.gov/billsummary/?BillNumber=5814&Year=2025Excerpts:- "Revised for 1st substitute: Modifying the application and administration of certain excise taxes."- "Engrossed substitute - ESSB 5814 ...

Chapter 422, 2025 Laws ... Effective date 7/27/2025*."(Note: DOR interim guidance clarifies effective timing for advertising services provisions as October 1, 2025—use the DOR guidance for operational taxability timing and details.)4) Federal Trade Commission — Disclosures 101 for Social Media InfluencersCitation: https://www.ftc.gov/business-guidance/resources/disclosures-101-social-media-influencersExcerpts:- "Do you work with brands to recommend or endorse products?

If so, you need to comply with the law when making these recommendations. One key is to make a good disclosure of your relationship to the brand."- "Disclose when you have any financial, employment, personal, or family relationship with a brand."- "Make sure people will see and understand the disclosure.

Place it so it’s hard to miss. The disclosure should be placed with the endorsement message itself."- "Use simple and clear language... terms like 'advertisement,' 'ad,' and 'sponsored.'"If you’re ready, I can now draft the full, SEO-optimized blog post and newsletter copy (with Washington-specific sections, practical checklists, example scenarios, and suggested next actions) based on this research.

If you want the guidance tailored to a specific creator scenario (sole proprietor vs. WA-LLC, ad-sales vs. affiliate commissions, platform-based marketplace sales, or influencer for brands), tell me which scenario(s) to prioritize and I’ll produce the final content.

• B&O tax basics (Washington): Washington’s B&O tax is a gross receipts tax measured on gross income from business activities (no deductions for labor, materials, taxes, etc.). Creators/affiliates earning commissions, referral fees, or other gross receipts from business activities generally must report those receipts for B&O tax purposes (classification depends on activity).
• Sourcing and the MPU (multiple points of use): DOR’s interim guidance explains that advertising services are sourced to the location where the purchaser receives the service (destination-based rules) and provides default sourcing rules when the location is unknown. The MPU exemption and allocation rules may apply for services used concurrently inside and outside Washington; DOR requires documentation and apportionment methods supported by records.
• Documentation and classification: DOR emphasizes classifying services based on information available at contract execution, keeping suitable records (contracts, invoices, targeting data, IP/geolocation or ZIP lookups), and the possibility of reclassification (which can affect tax treatment and refunds).
• Confirm whether the creator’s activities fit the DOR definition of “advertising services” (ask for specific business models: selling ad placements, providing optimization/lead-gen, referral links, or earning affiliate commissions).