New York Sales Tax Exemption

Education on helping your organization achieve sales tax exemption.

New York Sales Tax Exemption for a Nonprofit

In some states, your organization is not automatically exempt from state sales tax, even after obtaining 501(c)(3) recognition from the IRS. You must file a separate application in order to receive state sales tax exemption.

If your organization makes taxable sales or purchases, obtaining New York sales tax exemption will allow your nonprofit to allocate more funds towards pursuing its mission. However, learning state requirements, and preparing exemption applications correctly can take hours of staff and volunteer time.

Do I need to file a separate application to become exempt from New York sales tax?

It is a misconception that organizations that are exempt from federal income tax are also exempt from state taxes including sales tax. While each state varies, you typically must submit an application for sales tax exemption with the state once you receive your 501(c) determination letter.

How long does it take to become exempt from New York sales tax?

You should budget 1-2 months for the state to process your application. If the application has any deficiencies, the state will return it unapproved, which creates costly delays.