Business Office

Sales Tax Exemptions - State by State

Mercyhurst College is not only exempt from paying Pennsylvania State Sales Tax on purchases that are related to the tax exempt purpose of the College but also exempt in a number of other states as well.

If an employee chooses to purchase and item for their department and submits a request for reimbursement instead of purchasing the item using the purchase order, check request, or credit card system, THE COLLEGE WILL NOT REIMBURSE THE EMPLOYEE FOR SALES TAX CHARGED FOR THAT ITEM.

Sales tax charges can be avoided by using one of the above systems or by calling the vendor/organization in advance to determine if the College can be billed directly.

To determine the College's exempt status in any one of the states and to obtain information and applicable forms, simply select the state from the table below.

Categories of Tax and Related Exemptions

There are generally 5 categories of expenditures to which sales tax exemptions do or don't apply. Whether or not these items are exempt from sales tax may vary from state to state.

Vehicle Rentals – many states treat sales tax associated with the short-term rental of vehicles separately from general sales tax. Many times we are NOT exempt from motor vehicle tax. If the tax is an extension of the general sales tax we would be exempted.

Hotel / Occupancy Tax – many states also treat sales tax associated with the short-term lodging separately from general sales tax. Many times we are NOT exempt from occupancy tax and most local, county and city taxes. If the tax is an extension of the general sales tax we would be exempted.

Food – this relates to the purchase of food for consumption.

Goods – this is the general category for the purchase of most goods, known exceptions will be listed on the state page.

Services – this is the general category for the purchase of most services, known exceptions will be listed on the state page.

General Rules with Respect to the Exemption

Purchase must be for the College – in order to be eligible the purchase must be for Mercyhurst College in line with our exempt purpose as an institution of higher education. If the purchase is not for Mercyhurst College or does not relate to or benefit our exempt purpose, the exemption CANNOT BE CLAIMED.

College Funds – to properly claim a sales tax exemption proof must be provided that the expenditure being made if from College funds for College purposes. The best way to handle this requirement is to issue a purchase order to the vendor/ organization, issue a College check made payable to the vendor/organization, or make the payment on a College credit card.

Exemption Certificate – generally, an exemption certificate must be made out to the vendor/organization and signed and dated by the finance director, controller, or other official of the College. These certficates are available for downloading on the individual states' page linked above.

Prohibitions – an employee or other individual is NEVER permitted to use the exemption certificate or make a claim for sales tax exemption for any purchase or transaction other than Mercyhurst College business.

How to claim the exemption

Plan Your Purchase – utilize the College's established disbursement processes, purchase order, check request, or credit card payment to ensure payment from College funds is evident.

Communicate with the Vendor/Organization – especially if the amount of sales tax is significant or the exemption is questionable, talk with the vendor and make them aware that we are sales tax exempt and that we expect to utilize our exemption.

Acquire an Exemption Certificate – obtain an exemption certificate (or whatever the particular state may require) and complete it fully. The applicable forms are listed on each of the state's individual pages and most have the Mercyhurst College information already complete. Some states require a registration number, others just an exemption form, and yet others request a copy of the College's IRS Determination Letter. A copy of the Determination Letter is included on each of the state's individual pages. You will then have to have the form signed by the Director of Finance (Jim Lieb) or the Controller (Dave Hewett). Supply this form to the vendor when initiating the purchase.

Follow Through – make sure that once your purchase is complete that you did, in fact, not get charged for sales tax. In situations where the payment of sales tax is not appropriate, sales tax will not be paid nor reimbursed.

Exemption Exceptions

If there are any known exceptions to the general rules they will be listed on the individual state pages.

Contact the State's Department of Revenue or similar governing authority

If available, a contact at the state's department of revenue (or equivalent) will be listed on the individual state pages.

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