Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2014
Sales and Use Tax Annotations
390.0000 NONPROFIT ORGANIZATIONS
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.