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Idaho Corporate Tax Exemption

 

STEPS TO APPLYING FOR TAX EXEMPTION IN IDAHO

Is a nonprofit corporation in Idaho eligible for any state tax exemptions?

Nonprofits corporations are eligible for Idaho corporate income tax exemption, if the IRS has already granted the organization 501c tax exempt status. However, the IRS exemption doesn’t lend itself to any other state taxes like sales tax.

Are there any applicable taxes if I am selling any items through my nonprofit corporation in Idaho?

Nonprofit corporations do need to collect sales tax when selling things like retail items, admissions to events, and even when renting out facilities for things like community basketball games. Also, you may need to pull a seller’s permit from the Idaho State Tax Commission if your tax exempt nonprofit sells retail items.

What if my nonprofit corporation in Idaho holds auctions? Do I collect sales tax on items sold?

If your Idaho nonprofit corporation does hold auctions, you must collect sales tax on items sold, but only for the fair market value of the item. What the heck does that mean, you ask? Well, say you are auctioning a baseball that is only worth $10, but it sells for $100. If you give the buyer a receipt indicating the fair market value of $10 and $0.60 worth sales tax (say it’s 6 percent sales tax) and the buyer gave a donation of $89.40, as long as your records show the same transaction, you won’t have to charge sales tax on whole $100. This is where good record keeping will pay off.

Additional Tax Resources

Idaho Taxes

501c3 Tax Exempt Status

This comprehensive guide to obtaining and maintaining 501c3 status from the IRS includes information on how to prepare your nonprofit to apply for 501c3 status, as well as information about the forms and fees required by the IRS.

This guide overviews and includes the special tax-exempt language a 501c3 nonprofit organization must include as part of its articles of incorporation. 

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