Arkansas Clarifies Exempt Purchases and Sales by Charitable Organizations

Monday, May 20th, 2019

Person presenting at a charitable organization.
Exempt Entities

The Arkansas Department of Finance and Administration recently released a ruling clarifying the tax treatment of sales to and by exempt charitable organizations.

Arkansas exempts purchases of tangible personal property and services by charitable organizations. "Charitable organization" means an organization whose purpose is benevolent, philanthropic, patriotic, or eleemosynary (i.e., relating to charity), and whose function would otherwise have to be performed at public expense. The organization in question qualified as a charitable organization because it engaged in food distribution services, disaster relief, anti-human trafficking efforts, and other qualifying services.

The ruling also explains that sales by qualifying organizations are exempt as long as the sales do not compete with sales made by for-profit businesses. Sales by a charitable organization do not compete with sales by a for-profit business if (1) the sales are conducted by a member of the charitable organization, (2) all proceeds go to the charitable organization, and (3) the sales are temporary and are not held more than three times per year.

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TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at or call 866.578.8193.

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