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Minnesota: Fundraising Sales Tax Flow Chart


 Are your sales taxable or exempt?

Ah, flow charts. Who doesn’t love them? If you don’t find all the arrows and clumps of text confusing, they can convey some pretty good information. And so the Minnesota Department of Revenue has created a flow chart entitled, Do I need to charge sales tax on my fundraising sales?

So, do I?

Youth and senior groups

In a nutshell, nonprofit youth and senior citizen groups whose annual gross receipts from fundraising events in Minnesota do not exceed $20,000 should not charge sales tax on those sales. They should charge sales tax on any fundraising sales in excess of the first $20,000.

Other nonprofits

Sales tax is not charged on fundraising events hosted by other nonprofit organizations (such as charitable, educational, religious), provided all of the following requirements are met:

  • No net earnings benefit a private individual
  • All proceeds are used for charitable, religious, or educational purposes
  • Separate accounting records are maintained for each fundraising event
  • The host of the event is not an active or passive agent of a for-profit organization or person
  • The event is not held on premises that are leased or occupied for 6-29 days
  • The fundraising organization bears financial risk for the event
  • Net revenue for the event equals or exceeds the state and local taxes
  • The event has no bingo or gambling activities
  • Qualifying fundraising events do not exceed 24 days per year
  • Gross receipts from fundraising does not exceed $20,000.

Otherwise, sales tax must be charged on fundraising sales.

If you learn best from staring at a flow chart, check it out here. If you prefer to digest text, check out the department’s Sales Tax Fact Sheet 180.

If you want to facilitate sales tax compliance, switch to automated sales tax software (SaaS). Learn how it works.

 


Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.