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Information on Tax Exemptions Policies for Nonprofit Organizations

For foreign nationals, the United States Department of State provides a Diplomatic Tax Exemption Card, which is good for an exemption from sales taxes or similar imposed taxes on purchases within the United States. This card is also useful for hotel stays and restaurant meals. The diplomatic tax exemption card can be obtained from the Department of State note 13-619, which dates July 19, 2013. The use of this card is limited to purchases of goods and services within the United States.

In addition, organizations can apply to be tax-exempt. Nonprofit organizations can obtain tax exemptions by qualifying under specific conditions. Generally, these organizations are organized for one or more IRC purposes. For example, an organization can be tax-exempt if it’s for religious purposes, social welfare, or charitable contributions. The Revenue Act of 1913 defines these organizations as tax-exempt. This document explains the process of requesting tax exemptions for organizations.

If you are a nonprofit organization, the federal government and the state of Vermont offer tax exemptions for certain purchases. For example, an organization that purchases a new wood boiler can be exempt from sales tax if it’s for charitable purposes. A qualified organization can also be exempt from paying sales taxes on property it purchases. However, some purchases require a completed exemption certificate. You can consult with your assessor or check online for available exemptions in your area.

Nonprofit organizations that make sales in Connecticut must obtain a sales and use tax permit. However, they can make sales at up to five fundraiser events per year without collecting sales tax. To obtain a Sales and Use Tax Permit, nonprofit organizations should check out the Department of Revenue Service’s SN 98(11) publication. If your nonprofit organization is making sales, you should apply for a Connecticut Sales and Use Tax Permit.

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Nataniel Snider

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