Thank you so much for your response. I will have to contact the State of California for the tax exempt quidelines. I just assumed with our "non-profit" and tax exempt status we didn't have to pay them. Now, I'll be reading the fine lines! It's amazing how much a person can learn as the PTO pres. Thanks, again! [img]smile.gif[/img]
Since you are talking about sales tax (rather than federal income tax), this is a state issue. The IRS wouldn't have anything to do with it.
Are you set up to be exempt from payment of sales tax in your state - and to what does that entitle you?
For example, in Texas, it means that we apply for sales tax exemption as a non-profit 501(c)(3). If approved, we can hold 2 fundraisers per year where no sales tax is collected/remitted. And we don't have to pay sales tax on most purchases.
However, beyond those two exemptions, we do pay sales tax to the state of Texas - for example on our T-Shirt sales.
If you are set up to be exempt, and all payments from the students are going to you, then whether or not sales tax is due to the state should be YOUR responsibility as the "retailer". Your wholesaler wouldn't charge you tax.
So you need find out the rules for your state and then contact the agency that governs sales tax collections. They should be able to answer your questions.
I'm in the process of negotiating our yearbook sales with our yearbook vendor. They included sales tax in the propasal. When I told them we are tax exempt and can provide them with our number they said can't accept it because we sell them to the students. First of all, isn't our descision to sell them to the students or give the yearbooks to them for free? Secondly, how does it benefit them not to accept our Tax Exempt Status? I was going to contact the IRS about this, but thought I would see if anyone here has ever been in this situation. We purchase our t-shirts from a vendor that has no problem not charging us taxes because of our status. Are there certain circumstances I'm not aware of??
