Agency: Dept. of Revenue Sales, Use & Business Tax Division
Tel. No.: (334) 242-1490
Fax No.: (334) 353-7867
Public Schools (K-12) - Exempt
Private Schools (K-12) - Exempt
School Groups (e.g., clubs, bands, teams) - Exempt
PTAs - Exempt
PTOs - Exempt
Other (booster clubs) - Exempt
Church Groups - Not Exempt
Youth Sports League - Not Exempt
501 (c)(3) organizations - Not Exempt
501 (c)(6) organizations - Not Exempt
1a. Are local sales and use taxes in your State applied to these groups in the same manner as State sales and use taxes are applied to these groups?
1b. Please set forth any comments including a list of groups not listed above whose fundraising activities are exempt from sales and use taxation in your State.
Those groups marked as "exempt for fundraising purposes" are exempt pursuant to Section 40-9-31, Code of Alabama 1975. Sales and Use Tax Rule 810-6-2-.88.04 also addresses this exemption.
None of the groups marked as "not exempt" enjoy a "group" exemption. Certain individual organizations within these groups may be exempt pursuant to a special act of the Legislature. Sales and Use Tax Rule 810-6-3-.07-.05 lists charitable and nonprofit organizations that are exempt by special act.
NO EXEMPTIONS ALLOWED
Candies and Confections
Cookies and Other Baked Goods
Nuts, popcorn and other snack food
Other edible items (please identify)
Paper products (e.g., calendars, cards
stationery, books, gift wrap)
Decorative tins, baskets, other containers
Decorative novelties (mugs, ornaments)
Sundry items (please specify item below)
Clothing and accessories
Plant and seeds
Other hard good items
2a Are local sales and use taxes in your State applied to these products in the same manner as State sales and use taxes are applied to these products?YES
2b Please set forth any comments including a list of products not listed above that are exempt from sales and use taxation for fundraising purposes in your State.N/A
Limits on number of fundraiser events per year
Limits on duration of fundraisers
Limits on dollar amount of each item
Limits on total amounts raised per year
The groups marked as "exempt for fundraising purposes" are exempt provided the net proceeds from the fundraising sales are used solely for the benefit of the elementary or secondary school (K-12).
Section 40-9-31 and Sales and Use Tax Rule 810-6-2-.88.04 do not prescribe a specific procedure to establish a groups qualification for the exemption. A qualifying group, however, may obtain a certificate of exemption (Form STE-1) pursuant to Sales and Use Tax Rule 810-6-5-.02 as evidence of its exemption.
The fundraising group (e.g., school, PTA, church) and the company distributing goods to the fundraising group.
If the nonexempt fundraising group has a sales tax license, it is responsible for collecting and remitting the sales tax. Otherwise, the distributor must collect the sales tax from the nonexempt fundraising group and remit the tax to the Revenue Department.
Price paid by fundraising group to distributor and price paid by consumer to fundraising group.
The party responsible for collecting the tax must calculate the tax on the price paid by the party to whom it makes the taxable sale.