New Jersey – Tax Treatment of Nonprofit Organizations and Government Entities

SALT Report 2574 – The New Jersey Division of Taxation issued a bulletin that addresses the tax treatment of nonprofit organizations and government entities. Generally, sales of tangible personal property, certain digital property, and services are taxable unless specifically exempted under the Sales and Use Tax Act. However, qualified exempt organizations as well as New Jersey State and Federal government entities are eligible for sales tax exemptions.

These organizations and government entities, as well as the businesses that sell to them, need to be familiar with the exemption requirements, in order to avoid liability. Therefore, the Department’s publication provides a summary of the types of entities that qualify for the sales and use tax exemption.

In addition the bulletin addresses how to apply for exempt status, the application of tax to sales and purchases made by exempt organizations or government entities, the exemption certificates that should be provided to sellers, contractor exemptions, foreign diplomats and embassies, and taxes other than sales and use tax that may also qualify for the exemption.

For Further Information

New Jersey Division of Taxation – Bulletin MISC-3, Tax Treatment of Nonprofit Organizations and Government Entities