Business & Occupation Tax Information
The City of Mercer Island charges a Business and Occupation Tax on gross revenues earned within the City limits during each tax year. Tax payers are required to file an annual B&O Tax return at the end of each calendar year. Those taxpayers earning in excess of $1.0 million a year will be required to remit quarterly B&O tax returns. The Business and Occupation tax rates, as established by City Resolution, are as follows:
|First $150,000 per year
||Exempt from tax
|$150,001 and greater per year
||0.0010 multiplied by the gross taxable revenue with a $20.00 minimum payment required.
The Business & Occupation Tax regulations are detailed in MICC Chapter 4.10.
According to State law the City of Mercer Island Business and Occupation tax code complies with all provisions related to the “allocation” and “apportionment” of income. In general, gross income for tax purposes should be allocated to the location where the business activity takes place. Exceptions include revenue generated from “Royalties” and “Services & Other” classifications which follow special apportionment rules. For those businesses falling under the “Services & Other” B&O tax classification and having a taxable presence in more than one jurisdiction, a Services Income Apportionment Worksheet needs to be completed in addition to the City’s B&O Tax form. The worksheet and tax forms are listed below.
Quarterly B&O Tax Return
Annual B&O Tax Return
If you have any questions, please contact the Finance Department at 206-275-7783.