The Tax Ruling Is In, And It’s Messy

This is a continuation of my blog post from Sept 6th: Jazz Musician and Tax Collector https://dannykolke.com/2025/09/06/jazz-musician-and-now-tax-collector-is-this-true/

Well, I got my answer. And honestly, I wish I could tell you it was all a bad dream. After weeks of waiting and wondering, the Washington State Department of Revenue sent me their official binding ruling yesterday September 29th, 2025. Yay. Fun emails…

Spoiler alert: It’s not great news. It’s messy news. Sure, let’s call it bad.

What I Asked For?

Back on September 9th, I submitted a detailed request to the DOR, asking them to clarify whether specific activities in my work counted as “live presentations” under ESSB 5814. I gave them real scenarios from my actual work life, what I currently do, and what I am thinking about doing to make a living.

I asked about school band workshops, booster club coaching sessions, jam sessions, performances at nonprofits, and potential future workshop offerings. The kinds of things that working musicians across Washington do all the time.

What They Told Me

Here’s the short version:

1) If you are teaching something to more than 1 person, you are collecting sales tax now.

2) If you are teaching lessons 1 on 1, or if you are performing, you are (mostly) in the clear. But don’t forget; you still have to pay B&O tax on that revenue.

Let me break down the ruling scenario by scenario, because this stuff matters:

Scenarios 1-6: You’re Now a Tax Collector

School band workshops (paid by the district), booster club coaching (paid by a nonprofit), regular rehearsals with student groups, jam sessions where you’re hired to host, and any workshop you design and sell yourself — all of these are now considered “live presentations” subject to retail sales tax.

Starting October 1, 2025, I have to add sales tax to my invoices for all of these activities.

The DOR’s definition is pretty broad: lectures, seminars, workshops, or courses where participants attend either in person or via the internet, and where people can give, receive, and discuss information with each other in real-time.

So yeah, if you are teaching more than one person, you are taxing it.

Here is the actual language I submitted:

Scenario 1 –
I am hired by a school band program to play with students and coach them in a workshop. These are during class time at a school. I am not an employee of the school district. I rehearse the band and teach them concepts in Jazz performance. Is this considered a live presentation and therefore do I add sales tax to my invoice?

Scenario 2 –
Same scenario, but I am hired by a booster club, which is a non-profit organization that supports special projects for the band program. Fundamentally, I am doing the same work, just not paid by the school or the school district. Is this considered a live presentation and therefore do I add sales tax to my invoice?

Scenario 3 –
I am hired by a booster program to rehearse and conduct a 3rd jazz ensemble. I work 1 hour a day. I am not an employee of the school district, and the booster program is a nonprofit. I invoice them at the beginning of each month for the rehearsals that month. Is that considered taxable under ESSB 5814?

Scenario 4 –
I am paid by a non-profit to perform and host a jam session, where students will sit in and play with us. Is this considered a live presentation, and do I need to charge sales tax to the non-profit that is paying me?

Scenario 5 –
If I design and deliver a workshop and charge participants to attend? Note, I don’t do this currently, but I am thinking of developing a group workshop that teaches band directors how to teach Jazz. Would this be considered a live presentation under ESSB 5814 and subject to sales tax.

Scenario 6 –
I was thinking about developing a workshop for jazz improvisation and teaching that to groups. Would that be considered a live presentation and subject to tax?

I was told in my ruling that all of these are considered Live Presentations. Now be advised, for our nonprofit I submitted the Jam Session question and was given a different answer, that it was a Performance and not considered a Live Presentation. So I am going to appeal that ruling. I have 30 days that I can submit.

Scenario 7: Performances are Not “Live Presentations”

Here’s the one piece of good news in all this: performances are not considered live presentations. According to the DOR: “Live presentations do not include performances such as concerts, plays, musicals, comedy shows, and opera.”

However, while the performances are not subject to Sales Tax under the new law, the DOR reminded me that this income is subject to B&O tax. All business revenue in Washington State is subject to B&O. So start filing those taxes musicians…

Yes, performance income and teaching income for private lessons is still subject to B&O tax under the Service and Other Activities classification, but NOT retail sales tax.

One-on-One Lessons: Still Safe from Sales Tax

The ruling confirmed: private, one-on-one music lessons remain exempt from sales tax. They’re not considered “live presentations” because they’re not group instruction with real-time interaction among multiple participants.

So my piano lessons continue as they always have; just the lesson fee, no sales tax added.

The Practical Reality

Let me be blunt about what this means for working musicians and educators in Washington:

Every musician has to set up an excise tax account with the DOR. You will need it to file and pay your B&O taxes. Yay. If you do group lessons, workshops, work for schools, etc. as a 1099’r you will need to use this same account to pay our sales taxes that you collect.

Next, figure out the correct tax rate for each location where you teach a workshop or group lesson, etc., and add those tax lines to all your invoices for workshops and coaching. Collect that money, and then remit it to the state on a regular schedule.

For schools and boosters programs: you are about to see a 9-10% increase in what it costs to bring in guest artists and clinicians. I am really sorry about this. In an era where music programs are already stretched thin and booster clubs are fundraising just to keep programs afloat, this is not a small thing.

For nonprofits hiring musicians for educational programming: Same deal. That workshop budget just got 10% more expensive for your attendees.

And yes, all revenue for all businesses, including musicians that only teach private 1 on 1 lessons need to pay B&O tax. Here’s a good link about B&O taxes: https://dor.wa.gov/taxes-rates/business-occupation-tax

What Happens If You Don’t Comply?

You may be saying to right now, “I’m not going to do it. This is crazy.”

Look, I get it. The temptation might be to just ignore this and hope it goes away. Or maybe you’re thinking, “They’ll never know” or “I’m too small for them to care about.”

Don’t do that!!!

Here’s the reality: If you’re required to collect sales tax and you don’t, you’re personally liable for that tax. Even if you never collected it from your clients. Even if you didn’t know you were supposed to. The state doesn’t care—you owe it. And it gets worse. The penalties are brutal:

Up to 39% penalty on the tax you didn’t collect or pay, plus interest
Mandatory 9% late penalty if you don’t pay by the due date
Penalties start at 5% but can climb to 25% depending on how long you’ve been non-compliant

So please, please don’t ignore this. It’s not worth the risk. More info on penalties: WA DOR Penalty Information

What You Need to Do

If you’re a musician or educator in Washington doing any kind of workshop, clinic, masterclass, or group teaching:

Register for an excise tax account with the WA DOR if you don’t already have one. Here’s the link.
Learn your local tax rates using the DOR’s tax rate lookup tool. They vary by location; North Bend is about 9.1%, Seattle is around 10.35%.
Update your invoices to include a separate line for sales tax on any educational services for group lessons, workshops, etc, starting October 1, 2025.
Have conversations with your clients now. Schools, boosters, and nonprofits need to know this is coming so they can budget accordingly.
Figure out your remittance schedule. You’ll need to report and pay collected sales tax to the state regularly.

This ruling is binding for only my business. You can request your own ruling.

For those of us who split our time between performing and teaching? We just got a whole new job we didn’t ask for.

Resources

Final Thoughts

I’m not going to sugarcoat this: I’m frustrated. I’m frustrated that this adds another layer of complexity to an already complicated profession. I’m frustrated that it’s going to make educational opportunities more expensive and potentially less accessible. I’m frustrated that the state sees struggling artists and underfunded music programs and thinks, “Yeah, that’s where we should collect more revenue.” But here we are.

We’ve always worn a lot of hats as musicians—performer, teacher, promoter, accountant, roadie, tech support. Now we add tax collector to the list.

Welcome to 2025.

Update 9/30/25: The ruling I received is specific to my business. If your situation differs from mine, I recommend requesting your own ruling from the DOR.

Disclaimer: I’m not a tax professional or lawyer. This is just a musician trying to understand and comply with new regulations. Consult with a tax professional for advice specific to your situation.

Update 9/30/25: I have been asked to share the exact response to my scenarios outlined above #1 thru 6. Here it is.
“Our response: Starting Oct. 1, 2025, live presentations are a retail sale subject to retailing business and occupation (B&O) tax and retail sales tax.  Live presentations include, but are not limited to, lectures, seminars, workshops, or courses where participants attend either in person or via the internet or telecommunications equipment that allows audience members and the presenter or instructor to give, receive, and discuss information with each other in real-time. Therefore, scenarios 1 through 6 are live presentations subject to retail sales tax.”

One more tidbit: I was on a call last week with the DOR and a number of WA State nonprofit organizations, where they stated that a guest conductor does not need to charge sales tax because it is related to a performance. That seems to directly contradict this ruling. I am planning on appealing this decision once I get more info to support that.