The Texas Comptroller has released guidance that clarifies the sales and use tax responsibilities of animal rescue groups and nonprofit animal shelters.
Animal rescue groups are required to pay tax on purchases unless the group has received tax-exempt status from the Texas Comptroller. Rescue groups that have received tax-exempt status can make purchases that support the group's purpose exempt from tax. Rescue groups with tax-exempt status are also authorized to make exempt sales for two days per year. Animal rescue groups are not required to collect sales tax on adoption fees during these exempt sales days. Non-exempt rescue groups are always required to collect tax on adoption fees.
The same rules that apply to animal rescue groups generally apply to nonprofit animal shelters. However, adoption fees charged by qualifying nonprofit animal shelters are exempt. "Animal shelter" means a facility that keeps or legally impounds strays, homeless, abandoned, or unwanted animals.