SC Sales Tax Laws Relating to Schools and Non-Profit Organizations
SC Sales Tax Laws Relating to Schools and Non-Profit Organizations (e.g. Booster Clubs)
We have had many inquiries about Booster Clubs and sales tax – whether they do or don’t have to pay, and if there is information about this available on line. We have consulted with the SC Department of Revenue and this is what we have been told:
According to SC Department of Revenue - DOR.SC.gov:
- Non-profit organizations such as Booster Clubs are exempt from income tax. They are not exempt from sales tax, with the exception of these two cases:
- Paying sales tax on items purchased specifically for resale (e.g. in school book stores)
- Charging sales tax on items sold for charitable purposes (e.g. fundraising)
- In both these cases, the organization must have a Retail License of its own and file monthly sales and use tax reports with the SCDOR.
- In other words, if a booster club buys reeds or recorders (or whatever) for resale, if they don’t pay us the sales tax, they must still collect it; and must pay it to the State of SC monthly. And they must have a current retail license in SC.
- There is no tax on print music sold to schools in SC, as it’s considered educational use. Technically, the music must be billed to a school and not to a booster club or to an individual to be tax exempt.
- Any items purchased out of state or on line by a person or school residing in SC are subject to sales tax. If the seller does not collect sales tax, it should be reported on the annual state income tax form. If not reported, the person or institution can incur serious penalties.
- Musical Innovations charges sales tax on all purchases in SC (except for print music sold to schools) unless a Retail License is presented and the items are purchased for resale (repair labor, shipping and other non-taxable items are considered services, not purchases, and are not taxable in SC).
Please feel free to consult DOR.SC.gov for clarification or further information.