Sales Involving Exemption Certificates

The Comptroller's Office issues sales and use tax exemption certificates to certain qualifying organizations, entitling them to make specific purchases without paying sales and use tax.

The following organizations can qualify for exemption certificates:

• Nonprofit charitable, educational and religious organizations
• Volunteer fire companies and rescue squads
• Nonprofit cemetery companies
• Qualifying veterans organizations
• Government agencies
• Credit unions

The exemption certificate is a wallet-sized card, bearing the holder's eight-digit exemption number and an expiration date.

Certificates issued to nonprofit religious, educational, and charitable organizations, nonprofit cemeteries, credit unions, and volunteer fire companies or rescue squads are printed on white paper with purple ink and contain an expiration date of September 30, 2012. Certificates issued to qualifying veterans organizations are printed on white paper with blue ink and contain an expiration date of June 30, 2009. Certificates issued to governmental entities are printed on white paper with red ink and contain no expiration date.

An organization may use its exemption certificate to purchase tangible personal property that will be used in carrying on its work. This includes office supplies and equipment and supplies used in fundraising activities, but does not include items used to conduct an "unrelated trade or business" as defined by Section 513 of the U.S. Internal Revenue Code.

An exemption certificate is not transferable and applies only to purchases made by the registered organization. It may not be used to purchase items for the personal use of officials, members or employees of the organization, or to purchase items that will be donated to the organization.

An exemption certificate should not be confused with a resale certificate, which is used by manufacturers, wholesalers and retailers to purchase, free of tax, the items they sell.