Is a domestic violence shelter's food purchases exempt from Kansas sales tax?

Plain-English summary

A domestic violence group asked whether food it buys to prepare meals for the residents of its shelter is exempt from Kansas sales tax.

Being a good-works nonprofit is not enough. The Department acknowledged that "[m]any organizations, such as your domestic violence group, perform a great deal of services for their communities with the funds that they raise." But it added: "not every non-profit organization enjoys an exemption from Kansas sales tax. Yours does not."

The 79-3606(v) exemption does not fit. "[T]he exemption found in K.S.A. 79-3606(v) would not be available to your organization, since the intended scope of said exemption is focused on the elderly, disabled and indigent persons." A domestic violence shelter's residents do not fall within that targeted scope.

Bottom line: the shelter is a nonprofit, but Kansas sales tax exemptions are specific. Without a statute that covers it, the organization must pay sales tax on the food it purchases; the K.S.A. 79-3606(v) exemption, which is aimed at the elderly, disabled, and indigent, does not apply.

What this means for you

Nonprofit status alone does not exempt purchases

Kansas does not give a blanket sales tax exemption to nonprofits. Each exemption names the entities and purposes it covers, and an organization has to fit an actual provision to buy exempt.

Read the exemption's scope closely

K.S.A. 79-3606(v) is aimed at services and facilities for the elderly, disabled, and indigent. If your organization and the people it serves do not fall within that scope, this exemption will not carry your purchases — even for a worthy cause.

Budget for tax on purchases

If no exemption applies, plan to pay Kansas sales tax on the goods your organization buys, including food for meals you prepare.

Common questions

Q: Is a domestic violence shelter exempt from Kansas sales tax on food?
A: No. The Department stated that "not every non-profit organization enjoys an exemption from Kansas sales tax. Yours does not."

Q: Why doesn't the K.S.A. 79-3606(v) exemption apply?
A: Because "the intended scope of said exemption is focused on the elderly, disabled and indigent persons," and the shelter did not fall within that scope.

Q: Does raising and spending money on community services change the result?
A: No. Doing community good works does not create a sales tax exemption; the organization still must fit a specific statutory exemption to buy tax-free.

Citations and references

• K.S.A. 79-3606(v) — a sales tax exemption whose intended scope, the Department explained, is focused on the elderly, disabled, and indigent persons; it was not available to the domestic violence shelter.

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: P-1999-158

Original ruling text

Private Letter Ruling

Body:

Office of Policy and Research

July 20, 1999

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Dear Ms. TTTTTTT:

We wish to acknowledge receipt of your letter dated April 30, 1999, regarding the application of Kansas Retailers’ Sales tax.

Many organizations, such as your domestic violence group, perform a great deal of services for their communities with the funds that they raise. However, not every non-profit organization enjoys an exemption from Kansas sales tax. Yours does not.

In closing, the exemption found in K.S.A. 79-3606(v) would not be available to your organization, since the intended scope of said exemption is focused on the elderly, disabled and indigent persons.

This is a private letter ruling pursuant to K.A.R. 92-19-59. It is based solely on the facts provided in your request. If it is determined that undisclosed facts were material or necessary to an accurate determination by the department, this ruling is null and void. This ruling will be revoked in the future by the operation of law without further department action if there is a change in the statutes, administrative regulations, or case law, or published revenue ruling, that materially effects this private letter ruling. If I may be of further assistance, please contact me at your earliest convenience at (785) 296-7776.

Sincerely yours,

Thomas P. Browne, Jr.
Tax Specialist

TPB

Enc

Date Composed: 08/03/1999 Date Modified: 10/11/2001

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