4 ms·
> Many (most?) states allow nonprofits to show a tax-exempt ID number at places like Wal-Mart or at hotels, and have sales, occupancy, and other taxes removed.
by maratd 13y ago
> Many (most?) states allow nonprofits to show a tax-exempt ID number at places like Wal-Mart or at hotels, and have sales, occupancy, and other taxes removed.
They also allow any business to do the same, as long as whatever is purchased is sold to another party as a part of doing business.
So a computer tech shop, for example, would never pay for any parts it purchases at the store that are then included in a system it sells.
- _delirium 13y agoUnder a VAT system, that's true across the board. But under the U.S. sales-tax system nonprofits have blanket exemption, while businesses generally don't. Services such as hotels used in business travel, for example, are generally not exempt, so the NFL would pay occupancy tax if it were not a 501(c)(6) organization (or a state chose not to recognize that exemption). And whether purchase of goods is exempt depends on the state and the specific kind of good; most provide very specific lists of exempted "machinery and equipment" that fall far short of everything. For example, here are California's rules: http://www.boe.ca.gov/sutax/faq426.htm#1 http://www.boe.ca.gov/sutax/faq426.htm#1