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S.F. No. 1875 - Expansion of Sales Tax Exemption for Nonprofit Organizations (as proposed by the A-1 amendment)
Author: Senator Ann H. Rest
Prepared By: Nora Pollock, Senate Counsel (651/297-8066)
Date: March 23, 2015


This bill expands the sales tax exemption for sales to nonprofit organizations.  Under current law, the exemption is available to nonprofit groups organized and operated exclusively for charitable, religious, or educational purpose if the item is purchased in the performance of those purposes.  The exemption is also available for sales to qualifying senior citizen groups.   This bill would extend the exemption to all 501(c)(3) organizations and retains the current law exemptions and exclusions for purchases by veterans groups, hospitals, outpatient surgical centers, and critical access dental providers, and nursing home and boarding care homes.  The bill also excludes from the exemption materials purchased by a contractor as part of a lump-sum contract; construction materials that will not be used principally by the nonprofit entity; lodging and prepared food, candy, soft drinks, and alcoholic beverages; and the leasing of motor vehicles.  Effective for sales and purchases made after June 30, 2015. 

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