1997 Minnesota Statutes

     297A.256 Exemptions for certain nonprofit groups. 

    Subdivision 1.    Fundraising sales by nonprofit groups. 
  Notwithstanding the provisions of this chapter, the following 
 sales made by a "nonprofit organization" are exempt from the 
 sales and use tax. 

    (a)(1) All sales made by an organization for fundraising 
 purposes if that organization exists solely for the purpose of 
 providing educational or social activities for young people 
 primarily age 18 and under.  This exemption shall apply only if 
 the gross annual sales receipts of the organization from 
 fundraising do not exceed $10,000. 

    (2) A club, association, or other organization of 
 elementary or secondary school students organized for the 
 purpose of carrying on sports, educational, or other 
 extracurricular activities is a separate organization from the 
 school district or school for purposes of applying the $10,000 
 limit.  This paragraph does not apply if the sales are derived 
 from admission charges or from activities for which the money 
 must be deposited with the school district treasurer under 
 section 123.38, subdivision 2, or be recorded in the same manner 
 as other revenues or expenditures of the school district under 
 section 123.38, subdivision 2b. 

    (b) All sales made by an organization for fundraising 
 purposes if that organization is a senior citizen group or 
 association of groups that in general limits membership to 
 persons age 55 or older and is organized and operated 
 exclusively for pleasure, recreation and other nonprofit 
 purposes and no part of the net earnings inure to the benefit of 
 any private shareholders.  This exemption shall apply only if 
 the gross annual sales receipts of the organization from 
 fundraising do not exceed $10,000. 

    (c) The gross receipts from the sales of tangible personal 
 property at, admission charges for, and sales of food, meals, or 
 drinks at fundraising events sponsored by a nonprofit 
 organization when the entire proceeds, except for the necessary 
 expenses therewith, will be used solely and exclusively for 
 charitable, religious, or educational purposes.  This exemption 
 does not apply to admission charges for events involving bingo 
 or other gambling activities or to charges for use of amusement 
 devices involving bingo or other gambling activities.  For 
 purposes of this paragraph, a "nonprofit organization" means any 
 unit of government, corporation, society, association, 
 foundation, or institution organized and operated for 
 charitable, religious, educational, civic, fraternal, senior 
 citizens' or veterans' purposes, no part of the net earnings of 
 which inures to the benefit of a private individual. 

    If the profits are not used solely and exclusively for 
 charitable, religious, or educational purposes, the entire gross 
 receipts are subject to tax. 

    Each nonprofit organization shall keep a separate 
 accounting record, including receipts and disbursements from 
 each fundraising event.  All deductions from gross receipts must 
 be documented with receipts and other records.  If records are 
 not maintained as required, the entire gross receipts are 
 subject to tax. 

    The exemption provided by this paragraph does not apply to 
 any sale made by or in the name of a nonprofit corporation as 
 the active or passive agent of a person that is not a nonprofit 
 corporation. 

    The exemption for fundraising events under this paragraph 
 is limited to no more than 24 days a year.  Fundraising events 
 conducted on premises leased for more than four days but less 
 than 30 days do not qualify for this exemption. 

    (d) The gross receipts from the sale or use of tickets or 
 admissions to a golf tournament held in Minnesota are exempt if 
 the beneficiary of the tournament's net proceeds qualifies as a 
 tax-exempt organization under section 501(c)(3) of the Internal 
 Revenue Code, as amended through December 31, 1994, including a 
 tournament conducted on premises leased or occupied for more 
 than four days. 

    Subd. 2.    Statewide amateur athletic games.  
 Notwithstanding section 297A.01, subdivision 3, or any other 
 provision of this chapter, the gross receipts from the following 
 sales made to or by a nonprofit corporation designated by the 
 Minnesota amateur sports commission to conduct a series of 
 statewide amateur athletic games and related events, workshops, 
 and clinics are exempt: 

    (1) sales of tangible personal property to or the storage, 
 use, or other consumption of tangible personal property by the 
 nonprofit corporation; and 

    (2) sales of tangible personal property, admission charges, 
 and sales of food, meals, and drinks by the nonprofit 
 corporation at fundraising events, athletic events, or athletic 
 facilities. 

    HIST: 1Sp1985 c 14 art 2 s 10; 1987 c 268 art 4 s 18; 1988 c 
 719 art 10 s 16; 1994 c 587 art 2 s 14; 1996 c 471 art 2 s 22; 
 1997 c 31 art 2 s 46