Exemption Certificate Use by Contractors

A contractor may use an organization's exemption certificate to purchase materials that will be used to construct, improve, alter or repair the real property of private, nonprofit charitable, educational, and religious organizations; volunteer fire companies and rescue squads; and nonprofit cemeteries. The materials must be incorporated into the realty to qualify for the exemption. Sales of materials used to improve the realty of government entities, credit unions and veterans organizations are taxable, and their certificates may not be used by contractors.

A contractor may use an exemption certificate from a nonprofit organization if the first two digits of its exemption number are:

• 29 (religious organizations),
• 31 (charitable and educational organizations), or
• 33 (volunteer fire departments, rescue squads and ambulance companies).

A contractor may not use an exemption certificate from an organization if the first two digits of its exemption number are:

• 30 (government agencies), or
• 32 (credit unions), or
• 34 (veterans organizations).