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Last Updated: 2/23/2017

Qualifying for Minnesota Nonprofit Exempt Status – Sales Tax

Minnesota law exempts certain nonprofit organizations from paying Sales and Use Tax. To get this exemption, an organization must apply to the Minnesota Department of Revenue for authorization (known as “Nonprofit Exempt Status”).

Note: Being exempt from federal income tax does not automatically mean an organization is exempt from sales and use tax in Minnesota. You must apply for the state’s sales tax exemption.

What organizations can apply for this exemption?

To apply, your nonprofit must be exempt from federal income tax and meet other requirements, as listed in the table below.

Must be exempt from income tax under

Must also be

Internal Revenue Code, section 501(c)(3)

Organized and operated exclusively for charitable, religious, or educational purposes

Internal Revenue Code, section 501(c)

Senior citizen group organized for pleasure, recreation, or other nonprofit purposes.

Limited to members who are 55 or older, or disabled

Organizations that may qualify include:

  • Churches
  • Museums and historical societies
  • Private schools, colleges, and universities
  • Senior citizen groups
  • Volunteer fire departments
  • Youth organizations, including scouts, 4-H clubs, YMCA, YWCA, and youth sports associations

How do I apply?

To apply for Nonprofit Exempt Status, you must submit Form ST16, Application for Nonprofit Exempt Status – Sales Tax. We will send you a letter notifying you if you qualify or not. 

Organizations that do not qualify

If your organization does not meet the criteria listed above, it does not qualify for Nonprofit Exempt Status. Examples include:

  • Adult sports clubs of any type
  • Chambers of Commerce
  • City-run celebrations
  • Fraternities or sororities
  • Homeowners’ associations
  • Jaycees, Kiwanis, and Lions Clubs
  • Knights of Columbus and Masonic Lodges  
  • Lake improvement associations
  • Medical clinics
  • Prayer societies
  • Social clubs
  • Trade and professional associations

Note: Veteran organizations do not qualify for Nonprofit Exempt Status but they may claim a limited exemption on some purchases. For details, see the Purchases section.

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