Property Tax Exemptions for Washington Nonprofits – Charity Lawyer Blog

Property tax exemptions for Washington Nonprofits can be confusing. While many nonprofits enjoy federal tax-exempt status, that doesn’t automatically mean they’re exempt from property taxes at the state level. In Washington, a nonprofit must meet specific criteria to qualify for a property tax exemption, and approval is based on how the property is used rather than the organization’s tax-exempt status alone.

If your nonprofit owns property, understanding who qualifies and how to apply for an exemption can help you plan your finances effectively. Here’s what you need to know.

What Types of Nonprofits Qualify?

Not all nonprofits qualify for property tax exemptions in Washington, but those engaged in the following activities maybe eligible:

1. Educational Institutions

• Private nonprofit schools, colleges, and universities
• Properties used for educational purposes, including dormitories

2. Religious Organizations

• Churches, synagogues, mosques, and other places of worship
• Parsonages and convents for clergy residence

3. Healthcare Facilities

• Nonprofit hospitals, nursing homes, and assisted living centers
• Outpatient dialysis facilities and blood or tissue banks

4. Social Services and Public Benefit Organizations

• Orphanages and childcare centers
• Nonprofits providing protective or rehabilitative services

5. Arts, Culture, and Museums

• Museums, art galleries, and historical collections
• Performing arts organizations that own property used for public performances

6. Public Meeting Spaces

• Nonprofits that maintain community assembly halls and meeting venues

7. Cemeteries and Burial Grounds

• Nonprofit cemeteries operated for public use

8. Character-Building and Youth Development Organizations

• YMCA, YWCA, Boy Scouts, Girl Scouts, and similar groups focused on moral and ethical development

9. Nonprofit Camps

• Camps that provide supervised recreational activities for children and families

10. Veterans and Relief Organizations

• Recognized groups serving veterans, active military, and their families

What Properties Are NOT Eligible?

Even if a nonprofit qualifies in one of the categories above, the property itself must be used exclusively for exempt purposes. This means:

• A church that holds regular worship services in its building can qualify.
• A nonprofit renting out part of its property for commercial use (even if proceeds go to the nonprofit) may not qualify.
• A nonprofit that owns an investment property and uses rental income for its mission does not qualify for an exemption.

Each exemption request is reviewed on a case-by-case basis, so nonprofits should ensure their property is used in line with Washington’s legal standards.

How to Apply for a Property Tax Exemption

If your nonprofit qualifies, here’s how to apply for an exemption through the Washington State Department of Revenue:

1. Submit an Application

• Applications must be submitted within 60 days of acquiring a property or converting it to an exempt use.
• A late application fee may apply if you miss the deadline.

2. Provide Supporting Documents

The application typically requires:

• Proof of nonprofit status (IRS 501(c)(3) determination letter)
• Articles of Incorporation & bylaws
• A detailed map or site plan of the property
• Financial documents showing how the property is used

3. Renew Annually

• Approved nonprofits must renew their exemption every year by March 31 to maintain it.
• If a property is no longer used for an exempt purpose, the exemption may be revoked.

For complete application details, visit the Washington State Department of Revenue.

Final Thoughts

Property tax exemptions can provide significant financial relief for nonprofits, but the key to qualifying is how the property is used. If your organization is eligible, make sure to apply promptly and follow the annual renewal requirements.

If you’re unsure whether your nonprofit qualifies, it’s always best to consult with a tax professional or reach out to the Washington State Department of Revenue for guidance.

Ellis Carter is a nonprofit lawyer with Caritas Law Group, P.C. licensed to practice in Washington and Arizona. Ellis advises nonprofit and socially responsible businesses on federal tax and fundraising regulations nationwide. Ellis also advises donors concerning major gifts. To schedule a consultation with Ellis, call 602-456-0071 or email us through our contact form.