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Sales Tax Exemptions Explained!

Updated: May 24


When making exempt sales to exempt, it is important that you obtain all appropriate documentation required to substantiate the tax-free nature of the sale. On other words, if your jurisdiction requires you to obtain a certificate  or any other documentation, obtain the documents per their requirements.


Key Takeaways:


  1. Exempt organizations can include governmental agencies including the federal government, state governments, etc.

  2. Other exempt customers can include educational, religious, and charitable organizations.

  3. When making sales to exempt organizations, it is important that you obtain all appropriate documentation required to substantiate the tax-free nature of the sale.

  4. Exemptions are based on what is being sold and how it is being used.

  5. Sales and use tax exemptions are narrowly construed.

  6. Research which sales and use tax exemptions are applicable.


 

Our mission to provide a resource so business owners, accountants and bookkeepers can understand sales & use tax compliance. We know that sales and use tax laws are not the easiest to understand. Our focus is on empowering you with a framework and general understanding, so you know what questions to ask and where to go to get the information you need to stay on the right side of sales and use tax compliance.



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