Missouri – Taxability of Educational Materials and Books for Sale by a Non-Profit

SALT Report 1194 – The Missouri DOR ruled that sales of books and educational materials made to the general public in the main office or the education building of a Missouri non-profit are not subject to state sales tax because they were conducted within the organization’s exempt civic functions.

Missouri Code CSR 10-110.955(2)(D) states:

All direct sales made to or by Missouri not-for-profit civic, social, service or fraternal organizations, including qualified fraternal organizations exempt under Internal Revenue Code Section 501(c)(8) and (10), in their civic or charitable functions and activities are exempt from tax providing the net proceeds are designated for civic or charitable functions and activities.

All proceeds from the organization’s sales are used to support its efforts at preserving and improving the water supplies of Missouri through education and effective management of the region’s watersheds. The organization’s employees and volunteers do not receive compensation for selling these items.

However, the MDOR ruled that the organization’s sales of rain barrels and water bottles to the general public are subject to sales tax because the sales of these items are not in the civic or charitable functions and activities of the organization and are in competition with commercial establishments that also make these items widely available.

For Further Information:

Missouri Department of Revenue Letter Ruling No. LR 6914