Nonprofits, government organizations, and some other types of entities may be exempt from charging sales tax on ticket or merchandise sales in their state or locality.
If this is true of your event, you can find and enable the appropriate exemption on the Financial >> Sales Tax >> Setup page. Read the exemption carefully and make sure that it applies. By enabling an exemption, you are attesting that you believe your event is exempt under state tax law and can prove that in the event of an audit.
We recommend consulting with your tax advisor if you are not sure if an exemption applies to you.
To claim an exemption you've determined your organization applies for:
1. In Financial >> Sales Tax >> Setup, select your exemption reason.
2. Next, find the exemption you're eligible for. Exemptions in the state where your event address is located will be sorted at the top.
3. Click on the toggle for Enable Exemption?
4. At the bottom of the page, sign the exemption.
By enabling an exemption, you are indicating you are authorized to make such certifications on behalf of this organization.
5. Once signed, click Save Tax Settings to complete the form. Moving forward, all taxable items will no longer be charged sales tax for all state(s) according to the details of the exemption.
You must enable an exemption in order for TicketSignup to stop charging sales tax on your ticket sales. We do not automatically turn off sales tax for nonprofits and have no way of turning it off on a per-event basis.
If you believe that you are an eligible for a sales tax exemption that is not showing in our system, then we need documentation provided by the state or municipality to that effect. You can reach out to us with those details by sending an email to [email protected] or your account manager.
Frequently Asked Questions
Q: I don't see the option to choose an Exemption Reason. Where can I choose my reason for exemption?
A: If the Exemption Reason is not showing on the Sales Tax Setup page, then your payment account is not set up as a tax-exempt organization OR your state does not allow for sales tax exemptions. If your state allows for exemptions and your payment account is setup incorrectly, there are two options for you:
- Setup a new payment account (Financial > Payment Setup > Create New Account) and make sure the funds are paid out to “501c3 and other nonprofit”.
- Upload 990 filings and the IRS letter so that our team can change the legal entity type for your existing payment account.
Q: My organization is exempt from paying sales tax; why is our event collecting sales tax?
A: Please know that nonprofits who have certificates of exemption are, in almost all cases, exempt from paying sales tax on items they purchase. However, events on TicketSignup are the seller, not the buyer, and are not necessarily exempt. Please see our Taxability Matrix to determine if your state offers any exemption or what is taxable.
Q: Do I receive the sales tax and remit it to the state or are you collecting and remitting to the state on my behalf?
A: At this point, all states that collect sales tax require "online marketplace sellers," like TicketSignup, to collect the sales tax and remit it to the state on your behalf. If you need to prove to the state that sales tax was charged and collected, you can show them the sales tax summary report in the dashboard (Sales Tax >> Sales Tax Reports) and explain that TicketSignup, as the marketplace seller, handles this on your event's behalf.
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