Tax Exemption and Non-Profit Status Explained

State vs. Federal 501(c)(3)

State tax exemption is what you use so you don’t have to pay sales tax.  Most retailers (both physical and online) will need a form with your state information. Each state is different, and requires different forms. For instance, where I am located in Indiana, takes a ST-105 form. But if I want to go to Illinois to purchase something, I need to also be registered there and take my E-number along. Online purchases will generally use your home state’s form, but sometimes the retailer can be hard to work with.

State Tax exemption is not going to get you very far with these discounted tech services. You’ll need Federal exempt status.

Federal non-profit status is an IRS status that you use for many of these “services.”  It is related to your EIN, but just because you have an EIN does not mean you are federally registered as a non-profit.  If you are federally recognized, you will have a “Determination Letter” that they sent you.  If you are not sure, you can ask them, and they can issue a re-determination letter if needed.

Do you have any more thoughts for this article? Leave them in the comments! [I’m not looking for the debate about IF you should be, although that debate does exist! You can take up that debate with your peeps on Facebook and twitter, because everything important that happens in the world happens there.]

This article is a part of the Nonprofit Series. Click here to go back to the main page.

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