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An Important Scrap of Information for Direct Sales Independent Consultants


 A direct sales independent consultant.

“A man’s life in these parts often depends on a mere scrap of information.” Joe, A Fistful of Dollars

Emerging businesses should head the wise words of Joe in spaghetti western A Fistful of Dollars. The success or failure of a growing business may well depend on a mere scrap of information. Know it and your business can thrive. Ignore it and it could cost you big.

This is particularly true for direct sales independent consultants and multilevel organizations.

As explained by the Washington State Department of Revenue:

“As an independent consultant, you may need to register with Revenue depending on if your organization has a tax collection agreement with Revenue or if you have other business activities.”

Direct sales independent consultants must register with the Department of Revenue in the following situations:

  • When the direct selling organization does not have a tax collection agreement and the direct seller
    • Is required to collect retail sales tax, regardless of the amount, or
    • Has a yearly gross income of $12,000 or more.
  • When the direct selling organization has a tax collection agreement to collect and remit retail sales tax on behalf of consultants and the direct seller
    • Has yearly retail sales of $89,172 or more, or
    • Has a yearly commission or $56,000 or more.

When the direct selling organization has a tax collection agreement to report both business and occupation (B&O) and retail sales taxes on behalf of consultants, direct selling consultants don’t have to register with the Department of Revenue unless other business activities require registration. Additional information.

Direct sales independent consultants can simplify sales tax management in Washington and other states by implementing automated sales tax Software-as-a-Service. Learn how it works.

photo credit: what happen to the pink? via photopin (license)


Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.