The following post was written before receiving an official ruling from the DOR. See this updated post for the latest info: https://dannykolke.com/2025/09/30/the-tax-ruling-is-in-and-its-messy/?

There are big changes in the works in Olympia that may dramatically impact a hard-working community of musicians and educators. I have been trying to understand exactly what it means and I’ll just say that it’s very disturbing.

The following post is written by AI, in a conversation with me to help understand what possible scenarios are. I have reached out to our tax attorney and accounting firm to try to determine scenario by scenario some guidance to understand what changes need to happen. I have received some contradictory information between chatGPT and Gemini and Google, specifically on if wholesaling would be allowed.

Our little nonprofit is going to have to make some big changes. We cannot afford to have such a dramatic increase in cost, and we would be punished by providing free workshops to students. We have not charged for 15 years and have had thousands of students participate for free. I don’t think we can afford a 10% increase in our cost.

I don’t know that other venues will do. This will create a whole new layer of reporting obligations and be a burden to musicians and small venues alike. My instinct tells me that most venues aren’t going to be able to afford a 10% increase, so they are going to expect the musician to pay the tax. Or only play for tips. If you back it out of the amount it’s a 9% pay decrease. Of course, as a musician I am loaded and I can easily absorb that… yeah, that’s not true.

Here you go. Again, I’m just beginning to unpack this one. So please understand that as a disclaimer. I hope this is just not true and it’s all a bad dream.

REPEAT! I HOPE THIS IS NOT TRUE AND ALL A BAD DREAM!!!

Washington State Sales Tax on Live Presentations (Effective Oct 1, 2025)

Starting October 1, 2025, Washington State will begin taxing “live presentations.” That means many kinds of gigs that were previously tax-free will now require musicians to collect and remit sales tax.

This change comes from ESSB 5814 and is being implemented by the Department of Revenue (DOR). If you’re a working musician in Washington, here’s what you need to know.

Your Potential New Obligation

If you’re paid to perform or present live, in real time, your service may be considered a retail sale unless an exemption applies. If true, that means:

  • You must register with the WA DOR (if you haven’t already).
  • You must charge the current local sales tax rate on your invoices.
  • You must remit that sales tax to the state.

But the rules play out differently depending on where you’re performing and how the audience pays. Let’s look at some common scenarios.

Scenario 1: Free Public Park Concert (False?)

A city, nonprofit, or festival hires you to play in a public park. The audience enjoys the show for free.

  • Result: The transaction between you and the organizer is the retail sale.
  • You must add sales tax to your performance fee (e.g., $500 + 9.1% tax in North Bend).
    -This tax rate will vary based upon the city in which you perform.
  • The organizer pays you the total, and you remit the tax.

Scenario 2: Jazz Club with a Cover Charge (False?)

You’re booked at a jazz club that charges a $10 cover at the door.

  • Result: The ticket sale is the retail sale.
  • The club is responsible for collecting sales tax on the cover charge.
  • Your performance fee is considered a wholesale expense to the club. They should provide you with a reseller permit, and you bill only your fee (no tax).

Scenario 3: Coffee Shop or Wine Bar – No Cover Charge (False?)

You play at a café or wine bar that pays you a set fee but does not charge the public admission.

  • Result: This is just like the park example — your fee is the retail sale.
  • You must add sales tax to your invoice and remit it.

Scenario 4: Band Program Workshop (True?)

You’re hired by a school band program to play with students and coach them in a workshop.

  • Result: Because you’re an outside contractor, the workshop counts as a live presentation.
  • You must add sales tax to your invoice.
  • The only exception is if you’re a school employee and the workshop is part of tuition — in that case, no tax applies.

Scenario 5: Private Lessons One-on-One (True – No Tax)

You teach a student privately, either in person or online.

  • Result: Private lessons are not live presentations under the law. They remain a service exempt from sales tax.
  • You charge only your lesson fee — no sales tax required.
  • FAQ: What if I charge a tuition for private lessons? Even if you package lessons as a monthly or quarterly “tuition” payment, they are still treated as instructional services, which remain exempt from sales tax in Washington. You should charge only your lesson tuition fee, with no sales tax added.

Scenario 6: Paid to Host a Free Jam Session (False?)

If you are hired to lead or host a jam session that is open to the public for free, your fee is treated the same as a free concert in the park or a café with no cover charge. Because the public does not pay admission, the transaction between you and the organizer is the retail sale. You must charge sales tax on your fee and remit it to the state.

Scenario 7: Paid Rehearsal (True – No Tax)

If you are paid to rehearse with a group in preparation for a performance, that activity is not a public live presentation and is therefore not subject to sales tax. It is treated as a private service arrangement between you and the hiring party. You would bill only your rehearsal fee, with no sales tax added.

Scenario 8: Playing for Tips (True – No Tax)

If you are playing purely for voluntary tips from the audience, those payments are not subject to sales tax because they are considered gifts, not sales. However, if a venue adds a mandatory service charge or “music fee” to customer bills, that charge is taxable as part of the venue’s sales. If you also receive a guaranteed fee from the venue (with tips on top), the fee portion is still taxable under the normal live presentation rules, while voluntary tips remain untaxed.

Scenario 9: Creating and Selling a Workshop (True? Tax?)

If you design and deliver a workshop and charge participants to attend, this counts as a taxable live presentation. You must collect sales tax on each registration fee or ticket sold and remit it to the state. If, however, you are hired by a school to present your workshop as part of its regular tuition program, then the school is the one responsible for compliance and your fee may be exempt if you are treated as staff. But when you market and sell the workshop yourself, the responsibility to charge and remit sales tax falls directly on you.

What Musicians Should Do Now

  • You may need to register with the WA DOR for a tax account if you don’t already have one.
  • Know your local sales tax rate (it varies by city, e.g., North Bend ≈ 9.1%).
  • Update your invoices to add a sales tax line when required.
  • Ask venues about admission charges. If they sell tickets, you should get a reseller permit from them and bill only your fee.

Quick Links (WA DOR Resources)

Musicians in Washington have always worn a lot of hats — now we add tax collector to the mix.

Washington has a statewide base sales tax of 6.5%, and then local jurisdictions (cities/counties) add their own rate on top. The result is that the combined sales tax rate varies depending on the city (and sometimes even by neighborhood, if city boundaries overlap multiple tax districts).

For example (as of 2025):
• North Bend (98045): ~9.1%
• Seattle: ~10.35%
• Tacoma: ~10.5%
• Spokane: ~9.0%

Note/Disclaimer:

It’s me again. I have received contradictory information on the topic of wholesale fees if the venue charges a cover charge. I am definitely not a tax expert so don’t take my word for this. Read up and see what you can figure out. I know, like you don’t have enough to do.

My next steps is continuing research and consulting with our tax attorney and accountant, as well as contacting the Department of Revenue to make sure that we understand exactly what our obligation is. I’ll report back more when I find out more.

If we are lucky, this doesn’t apply to Entertainment because it doesn’t get caught up in the definition of Live Presentation – for now. But if you teach a workshop, then that probably still will apply? Just guessing for now.

This definitely shows that our State is willing to go after more businesses to increase their sales tax revenue. If not this time, are we next? I hope not.

Stand by.

9/8/25 – Monday Morning Update: I called the Washington State Department of Reveneue and they would not commit to saying that a musicians live performance, or workshop was exempt from collecting sales tax. Instead they directed me to a page to ask for a binding ruling to submit my request. So I am going through that process next. I will submit each of the sceranios in my blog post to clarify and ensure that we don’t have to collect sales tax. They ask to allow for 10 business days for a response and a “binding ruling.”

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