HB 2305
An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in sales and use tax, further providing for exclusions from tax.
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Sign in to take action- Introduced
- Passed House
- Passed Senate
- To Governor
- Became Law
Bill overview
This bill amends Pennsylvania’s tax law to provide a sales tax exemption for certain charitable organizations, volunteer fire departments, volunteer firefighters’ relief associations, and religious organizations when they purchase tangible personal property or services for their charitable, volunteer, or religious purposes. The exemption has specific limitations, such as not applying to unrelated business activities or construction contracts, and requires organizations to meet certain IRS and state requirements for tax-exempt status.
Key provisions
- Sales tax is exempt for charitable organizations, volunteer fire departments, and volunteer firefighters’ relief associations when purchasing tangible personal property or services for charitable purposes.
- Religious organizations are also eligible for the exemption when purchasing for religious purposes.
- The exemption does not apply to unrelated business activities or construction contracts.
- Organizations seeking tax-exempt status must meet IRS requirements (501(c)(3) or (4)) and state requirements under the Institutions of Purely Public Charity Act.
- Conditional tax-exempt status can be granted for two years, subject to meeting specific business plan requirements.
- The Department of Revenue can assess sales tax if the conditional exemption is improperly issued or if requirements are not met.
- The exemption may be revoked if an organization no longer qualifies as a purely public charity.
- The bill takes effect 60 days after it is passed.
Who is affected
Sponsors
Official sponsors from legislative records.
Primary sponsor
Cosponsors
John Inglis III
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