Search Category: Government, Education, Nonprofit

Sales a Nonprofit Makes

Nonprofit groups that make taxable sales are retailers. They must get an Idaho sales tax permit and collect and forward tax to the state. If a nonprofit has one-time or infrequent sales, it can get a temporary permit.

Taxable Sales

  • Gift shop sales (even if admission to the event or facility is tax exempt)
  • Admissions to recreational events (e.g., concerts at a botanical garden or a play put on by a synagogue)
  • Fundraising sales, door-to-door sales (e.g., cookies, candy, magazine subscriptions)
  • Concessions
  • Providing hotel, motel or campground accommodations to the public
  • Leasing or renting tangible personal property
  • Rummage or yard sales open to the public (the “home yard sales for individuals” exemption doesn’t apply to organizations)
  • Promotional items (e.g., logo patches, pins, printed materials)
  • Vending machine sales (see Vending Machines)

Nontaxable sales

  • A nonprofit’s membership
  • Charges for advertising space in publications (note: advertising inserts are taxable)
  • Car washes
  • Sales of raffle tickets
    Note: Some operators of raffles and games of chance must get a license from the Idaho Lottery.
  • Conference fees for educational, professional or religious events
  • Meals nonprofit or religious groups sell to senior citizens through programs under Title III-C of the Older Americans Act
  • Meals a church or temple sells at a members-only event
  • Incidental sales a religious organization makes
    • Items it sells must have been donated to the organization, or the organization must have paid tax when it bought the items.
    • The sale must not be made to the general public in competition with commercial businesses.
    • Proceeds of the sale must be used exclusively in the organization’s programs.
      Note: This exemption includes sales of property, admissions, taxable services, and providing hotel/campground accommodations.
  • Sales of literature when the nonprofit organization both publishes and sells it. None of the profits can go to an individual or shareholder of the organization.
  • Admissions
    • To nonprofit museums
    • To an event hosted by a 501(c)(3) or an organization conducting a tax-exempt function as defined in section 527 of the Internal Revenue Code that is not predominantly commercial or recreational, any included entertainment value is minimal when compared to the charge for attendance, and the hosting nonprofit has paid sales tax on property consumed during the event
  • Animals a 4-H or FFA club sell at a fair or the Western Idaho Spring Lamb Sale
  • Lodging sales the Ronald McDonald House makes
  • Sales of digital subscriptions
  • Fees to use a nonprofit’s shooting range facility or enter a nonprofit organization’s shooting competition

Sales that can be taxable or exempt

Suggested donations for admissions or sales

  • If a sign or other advertising says something like “donations accepted” with no amount mentioned and people can attend or buy something without paying, it’s a donation and you don’t have to charge tax.
  • When you establish or suggest a price for what you sell, you must charge tax. This is true even if you call it a “donation.”
    E.g., If a sign or other advertising says “$5 donation suggested,” all donations are taxable, whether they’re $1 or $50.

Auction items – fundraising events

  • Fundraising auctions differ from normal auctions when there is a donation component.
  • Although the amount of cash donation isn’t taxable, the sale of goods is. For this reason, it’s necessary to determine the portion of the sale that’s a cash donation.
  • An auction item for a fundraising event is subject to tax on its final bidding price unless you follow these procedures:
    1. Post the fair market value by the item you’re auctioning.
    2. Give the buyer an invoice that details the value, tax due on the value, and amount paid.

Note: If you hire a professional auctioneering service, the auctioneer will collect tax on the actual selling price, which includes fees (such as a buyer’s fees, credit card service fees, etc.). If you only hire an auctioneer caller, you are responsible for collecting sales tax.

Showing sales tax on receipts

As a retailer, you must separately list the amount of tax on the sales invoice. Businesses that want sales to be an even-dollar amount still must separately state the tax.

  • If you don’t separately state the tax, you must charge tax on the whole-dollar amount.
  • Sometimes businesses with high-volume or even-dollar sales don’t automatically give receipts. But you must give customers a receipt if they ask for it. A receipt showing the amount of tax you charged is the only proof they have to show they properly paid sales tax.

Donations

As a nonprofit, you don’t owe sales or use tax on things you receive as gifts, including items, cash, gift cards or certificates, labor or personnel time.

Donations of cash, gift cards and time

Donors don’t owe sales or use tax when they give cash, gift cards (or certificates), labor or personnel time.

Donations from donors’ resale inventory

Businesses that donate items from their resale inventory generally owe use tax on the donated items. Donors can make donations to you from their resale inventory exempt from sales or use tax only in the following situations:

  • Your organization is the Idaho Food Bank Warehouse, Inc.
  • Your organization is the Advocates for Survivors of Domestic Violence and Sexual Assault, Inc.
  • Your organization has a food bank or soup kitchen and donors give tangible personal property or food to you to grow, prepare, store or serve food.
    Note: Donations of motor vehicles and trailers aren’t exempt to food banks other than the Idaho Food Bank Warehouse, Inc.
  • Your organization is a nonprofit registered with the Idaho Secretary of State and the donor gives you food or beverages.
  • Your organization receives donations of clothing and more than 50% of your activities involve giving away clothing. (You’re a nonsale clothier.)
    Note: Donations of housewares a donor gives to a nonsale clothier aren’t exempt.
  • Your nonprofit organization is listed in Idaho Code 63-3622O and donors give tangible personal property that will become part of real property.
    Examples of exempt inventory withdrawals (donors won’t owe use tax):
    • Food and beverages grocery stores and restaurants give to nonprofit organizations
    • Shoes, coats and dresses a clothing retailer donates to groups that give away at least 50 percent of the clothing (nonsale clothiers)
    • Building materials a lumberyard donates to a nonprofit museum if the materials will become part of real property

Donors must pay use tax directly to the Tax Commission for all other inventory donations.

Other donations

Both individual and business donors must pay sales or use tax on most items they donate to you. If they haven’t paid sales tax when they bought the item, they must pay use tax directly to the Tax Commission. This may occur when an online seller does not collect and remit sales tax on your purchase or if you buy something in a state without a sales tax.

  • If donors already paid sales tax when they bought an item they’re donating, they don’t owe use tax.
  • If donors buy an item new to donate and didn’t pay sales tax, they owe use tax on the purchase price. If an item is used and the donors didn’t pay sales tax when they bought it, they owe use tax on the fair market value of the item at the time they donate it.
  • If donors were given a gift and then donate that gift, they don’t owe tax when donating that gift.
    Note: Donations of vehicles have special rules. When a donor gives a vehicle they received as a tax-exempt gift, they do not owe use tax on the vehicle. See: Donating a vehicle.

Recordkeeping for Sales and Purchases

You must keep records of all the purchases and sales that your business makes. Your records must show that you properly collected, reported and paid or forwarded taxes to Idaho.

Records you must keep

  • Normal books of account
  • Documents that support entries in the books of account
    Examples:
    • Bills
    • Receipts
    • Invoices
    • Cash register tapes
    • Credits granted
    • Job or work orders
    • Contracts
    • All schedules or working papers used to prepare your tax returns
  • Copies of sales tax resale or exemption certificates (e.g., Form ST-101)
    Note: Keep resale or exemption certificates for as long as the nonprofit does business with that buyer, plus four years We’ll bill you for tax due if you don’t have completed exemption certificates for buyers you sell exempt to.
  • Tax returns
  • Tax payments

What the records must show

  • Gross receipts from sales and services made in Idaho, even sales that you or your customer might consider exempt from tax. If you deliver the product or service somewhere other than your place of business, you must also keep records that prove where delivery took place.
  • The identity of customers claiming an exemption, the type of exemption, and what you sold them exempt.
  • All deductions claimed in filing returns.
  • The total purchase price of anything you bought for sale, rental, lease or your own use.
  • The amount of sales tax collected from your customer or that you paid to a vendor.

You must keep all sales and use tax records and exemption certificates for at least four years. (You should keep them for seven years if you don’t file returns.)

Laws and Rules For Nonprofit and Religious Groups

Learn more about nonprofit and religious groups:

Learn more about Idaho tax statutes 

Learn more about our Rules 

Governments

This guide explains how Idaho sales tax laws apply to government organizations. It includes how Idaho taxes the sales and purchases by governments.

Governments that are exempt

Sales to all government agencies and their political subdivisions are taxable, with the following exceptions:

  • Idaho government entities and political subdivisions are exempt from sales and use tax. They include:
    • The State of Idaho, its agencies and its departments
    • Any Idaho city, county, township, school district, irrigation district, cemetery district, local improvement district, fire protection district or other taxing jurisdiction
  • Certain organizations created through joint-powers agreements established under Idaho laws are exempt from Idaho sales and use taxes.
  • All federal government agencies are exempt from Idaho sales and use taxes.
  • Qualified foreign diplomats are exempt from Idaho sales and use taxes.

Recordkeeping

People selling to government agencies, and government agencies selling to others, must keep records of all sales. Their records must show that they properly collected, reported, and paid or forwarded taxes to Idaho.

Read the Recordkeeping portion of the Retailers guide for more information.

Schools

This guide explains how Idaho sales tax laws apply to schools like yours. It includes how Idaho taxes sales and purchases by schools. The guide also covers donations you receive, requirements for keeping records, and filing returns.

Schools exemption

A school that Idaho law defines as an educational institution can buy everything exempt from sales tax. Educational institutions are non-profit, offering a diversified course of study in the usual branches of learning. Their income is devoted only to education and they’re one of the following:

  • Nonprofit colleges and universities (both public and private)
  • Nonprofit primary and secondary schools (both public and private)
  • Idaho public charter schools
  • The Idaho Digital Learning Academy

A non-Idaho college, university, primary or secondary school also can buy everything exempt if it’s a qualifying educational institution.

Can’t buy exempt

For this exemption, educational institution does not include:

  • Schools that primarily teach:
    • Business
    • Dancing
    • Dramatics
    • Music
    • Cosmetology
    • Writing
    • Gymnastics
    • Exercise
    • Other special skills
  • Parent-teacher associations, parent groups, alumni and other auxiliary groups whose purpose is to help an exempt school
  • For-profit schools, colleges and universities, even when offering a full and diverse curriculum

Recordkeeping

Schools must keep the same records as any retailer. Those requirements are detailed below.

You must keep records of all sales by your school. Your records must show that you properly collected, reported and paid or forwarded taxes to Idaho.

Records you must keep

  • Normal books of account
  • Documents that support entries in the books of account, such as
    • Bills
    • Receipts
    • Invoices
    • Cash register tapes
    • Credit invoices or memos
    • Job or work orders
    • Contracts
    • All schedules or working papers used to prepare your tax returns
  • Copies of sales tax resale or exemption certificates (e.g., Form ST-101) given to you when you sell items tax exempt to customers or rent out facilities to them.
    Note: Keep resale or exemption certificates for as long you do business with that customer, plus four years. We could bill you for tax due if you don’t have completed exemption certificates for buyers you sell (or rent) tax exempt to.
  • Tax returns
  • Tax payments

What the records must show

  • Gross receipts from sales and services made in Idaho, even sales that you might consider exempt from tax. If you deliver the product or service somewhere other than your place of business, you also must keep records that prove where delivery took place.
  • The identity of customers claiming an exemption, the type of exemption, and what you sold them tax exempt.
  • All deductions claimed in filing returns.
  • The total purchase price of anything you bought for sale, rental, lease or your own use.
  • The amount of sales tax collected or paid.

You must keep all Idaho sales and use tax records and exemption certificates for at least four years.

Nonprofit and Religious Groups

This guide explains how Idaho sales and use tax laws apply to nonprofit organizations and religious groups. It includes how Idaho taxes sales and purchases that these groups make. This guide also covers donations made to the groups, requirements for keeping records for sales and use taxes, and filing returns.

There are many types of organizations that don’t operate to make a profit:

  • Health organizations
  • Social-service organizations
  • Charitable organizations
  • Museums
  • Religious organizations, including:
    • Churches
    • Synagogues
    • Temples
    • Mosques
    • Fellowship groups
    • Spiritual groups
  • Social clubs
  • Civic organizations

This guide refers to these organizations as “nonprofits.”

Sales to and purchases by nonprofits in Idaho are taxable unless an exemption applies.

Taxable transactions include:

  • Buying, renting or leasing tangible personal property
  • Admissions to events
  • Using property or facilities for recreation
  • Hotel accommodations

See Sales a Nonprofit Makes. 

Organizations and Sales Tax

Schools

Schools

Governments

Governments

Nonprofit and Religious Groups

Nonprofits

Organizations and Entities that can buy Everything Exempt

Organizations & Entities