The 501 S(c)ene

The latest view on not-for-profit accounting issues

Do Nonprofit Organizations Have to Pay Sales Tax in Arizona?

We often receive questions from clients asking whether Arizona offers an exemption from sales tax (transaction privilege tax) for non-profit organizations. Unfortunately, Arizona does not offer a blanket exemption like many other states.

However, there is an exemption on sales tax for retail items sold by non-profit organizations. It also includes the sale of food and drink, if the organization is not regularly engaged in the restaurant business.

There are additional exemptions provided for specific organizations, including qualifying health care organizations, and exemption from paying sales taxes on items purchased. Click here to view those.

By Kristin Cullen, CPA