Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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Annotation 390.0092

390.0092 Merchandise Given without Donation. A nonprofit educational foundation solicits funds to aid schools. The foundation will participate in a school fall festival. The main purpose of having a booth at the festival is to advertise the existence of the foundation and to solicit donations. The foundation is planning on giving out pencils on a random basis. The foundation paid sales tax reimbursement to its vendor at the time it purchased the pencils.

The foundation is the consumer of the pencils it purchased since the pencils are given away without charge. No further tax is due when the foundation gives away tax-paid pencils. 1/18/96.