Was a book exempt when published by a nonprofit historical organization but marketed and distributed through a separate commercial press?

Plain-English summary

Nonprofit organizations were not generally exempt from collecting tax on taxable items they sold.

The exemption effective August 28, 1989 applied to writings both published and distributed—shipped, marketed, or sold—by certain qualifying nonprofit organizations, including historical organizations.

Although the historical organization would publish this book, the brochure said a separate commercial press would market it. Because the nonprofit did not appear to distribute the book itself, the sales were taxable. The letter also said the book's 1987 sales had been taxable.

Common questions

Was nonprofit publication alone enough? No.

What else did the exemption require? Distribution by the qualifying nonprofit.

Was this book taxable? Yes.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8911L0964E06

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

BOB BULLOCK
Comptroller October 11, 1989

Dear ***:

Thank you for your recent note asking if non-profit organizations
have to collect sales tax. You specifically referenced a brochure
from ** Press regarding a book entitled Six Months from
Tennessee.

Non-profit organizations are not exempt from collecting sales tax
on taxable items they sell.

The brochure states that "The Northeast Texas Historical Preservation
Association (NETHPA) will publish the book. Once printed, it will then
be marketed through the facilities of *** Press in ***."

Effective August 28, 1989, books magazines, newsletters and other
writings that are published and distributed by certain non-profit
organizations are not taxable. This includes religious, philanthropic,
charitable, historical, or scientific organizations. But it does not
include non-profit educational organizations.

Although the book is published by a historical organization, it does
not appear to be distributed (shipped, marketed, or sold) by the or-
ganization. Sales tax would be due on the sale of the book. The sale
of the book was also taxable in 1987 although the brochure shows "0"
tax due.

This opinion is based on the facts presented. If there are additional
or different facts, the opinion may change.

If you have any questions or need additional information, you may call
toll free 1-800-252-5555 or the regular number 512/463-4600. My exten-
sion is 3-4666. You may write to Tax Correspondence, Comptroller of
Public Accounts.

Sincerely,
Jo Ann Dieck
Tax Correspondence