As part of your nonprofit organization’s activities to raise funds, you may become involved in the sale of items and will have to understand the Minnesota sales tax exemption rules and regulations which apply equally to schools, churches, religious organizations and other nonprofit groups. It may be necessary to retain the professional expertise of a legal firm who are niche providers of assistance in this specific area.
Rules Are Not Easy to Understand
To be able to understand the Minnesota sales tax exemption rules, your legal firm will provide you with the necessary information in a process that you will easily understand and avoiding the heavy use of jargon and legal know-how.
Sales tax applies to all merchandise and goods that are sold, except where there is a legal exemption. There is no general exemption for all nonprofit organizations, and the Minnesota sales tax exemption must be applied for and received formally. The state is trying to ensure that only authorized nonprofits and others can receive the exemption and that the position is not being abused by an operating company.
What May Apply?
From the smallest cake sale to the largest global activity, any sale may be included. This will include any sales of food and beverages, tickets that can be exchanged for food and drink as well as for the purchase of booklets.
You may have to consider a sales tax on tickets for fundraising events and whenever you organize an online sale which may include silent auctions or straightforward merchandise sales.
There is also a range of non-taxable activities, and it is important that the law firm specifies which events and occurrences in the process of managing the non-profit organization may be included in either the taxable or the non-taxable lists.
Your legal firm will provide specific information about whether sellers permits are required and how your nonprofit will complete their sales, record information and clarify this with the taxation department to ensure that any sales exemption is qualified and continuous.
