|
501(c)(3) and 501(c)(4) Organizations -
501(c)(3) and 501(c)(4) organizations must provide proof that they are exempt
under these codes by the Internal Revenue Service. In addition to this they must
provide a certificate of exemption stating that the property will be used or
consumed in carrying out the operations of the organization. Revenue
Administrative Bulletin
1995-3 and
2002-15 has more information on this topic.
Wholesalers claiming an exemption should
provide a written statement that they are purchasing for "resale at wholesale".
Sale tax licenses are not issued to wholesalers.
Retailers - Retailers purchasing for
resale should provide a signed exemption certificate provided in
Revenue
Administrative Bulletin 2002-15 stating that the purchase is for resale.
Their sales tax license number must be included on the exemption claim. However,
a seller should not accept the sales tax license number alone as a claim of
exemption. The department does not issue tax-exempt numbers. The exemption
certificate can be obtained in
Revenue
Administrative Bulletin 2002-15.
Industrial Processors - An industrial
processing exemption is allowed for property which is used or consumed in
transforming, altering, or modifying tangible personal property by changing the
form, composition, or character of the property for ultimate sale at retail or
for sale to another processor for further processing and ultimate sale at
retail. The industrial processing exemption does not include property which is
or becomes affixed to real estate, office supplies, administrative office
equipment, or vehicles licensed for public highway use, except when the vehicle
is used to mix and agitate materials added at the plant or job site in the
concrete manufacturing process. Industrial processing also does not include the
receipt or storage of raw materials extracted by the user or consumer or the
preparation of food or beverages by a retailer for retail sale. The exemption
certificate can be obtained in
Revenue Administrative Bulletin 2002-15.
Churches - Sales to organized churches or
houses of religious worship are exempt from sales tax. These exempt sales must
not involve property used in commercial enterprises. Vans or buses may be
purchased exempt if the manufacturer's rated seating capacity is 10 or more and
it is used primarily for transportation of persons for religious purposes.
Churches may not purchase any other type of vehicle exempt. Anyone who is
directly engaged in the business of constructing, altering, repairing, or
improving real estate for a church or a house of religious worship is liable for
the sales tax on the inventory value of the materials affixed to the property,
even if the church purchases the materials.
Revenue Administrative Bulletin 1995-3
and
2002-15 has
more information on this topic.
Hospitals - Sales to hospitals are exempt
from sales tax when the organization is not operated for profit. The income or
benefit from the operation must not inure to any individual or private
shareholder, directly or indirectly.
Revenue Administrative Bulletin 1995-3 and
2002-15 has more
information on this topic.
Schools - Sales to schools and parent
cooperative preschools are exempt from sales tax when the organization is not
operated for profit. The income or benefit from the operation must not inure to
any individual or private shareholder, directly or indirectly. PTA, PTO, and all
other groups and organizations must qualify separately for exemption when making
purchases for their organizations. Sales to teachers are subject to tax.
Revenue Administrative
Bulletin 1995-3 and
2002-15 has more
information on this topic.
Government - Sales to the United States
government, the State of Michigan and its political subdivisions, departments
and institutions are not subject to tax, if the sales are ordered on the
government form or purchase order and are paid for directly to the seller by
warrant on government funds. Sales to the American Red Cross, and its chapters
and branches are exempt. All sales to other states or countries are subject to
Michigan sales tax. Sales to employees of the government for their own use are
subject to tax.
Revenue Administrative Bulletin 2002-15 provides the exemption certificate.
| 
Printer Friendly
Text Version 
Email Page
