MICHIGAN SALES AND USE TAX TREATMENT OF NONPROFIT ENTITIES

•  Nonprofit schools, nonprofit hospitals, and homes for children and aged persons 
•  Regularly organized churches and houses of religious worship 
•  Veterans’ Organizations; Fundraising Sales by 501(c)(19) Veterans’ Organizations 
•  Fundraising Sales by Nonprofits Other Than Veterans’ Organizations 
•  Claiming the Exemption   
•  Auction Sales and Raffles 

Pursuant to MCL 205.6a, a taxpayer may rely on a Revenue Administrative Bulletin issued by the Department of Treasury after September 30, 2006, and shall not be penalized for that reliance until the bulletin is revoked in writing. However, reliance by the taxpayer is limited to issues addressed in the bulletin for tax periods up to the effective date of an amendment to the law upon which the bulletin is based or for tax periods up to the date of a final order of a court of competent jurisdiction for which all rights of appeal have been exhausted or have expired that overrules or modifies the law upon which the bulletin is based.

RAB 2020-25.  This Revenue Administrative Bulletin (RAB) describes the sales and use tax treatment of tangible personal property and taxable services sold to and sold by certain exempt nonprofit entities. This RAB replaces RABs 1988-42, 1991-19, and 1995-3.

• 501(c)(19) Category for Veterans associations. Donations are tax deductible to the extend allowed by law.
• 501(c)(3) Donations not limited and tax deductible to the extent allowed by law.
• 501(c)(4) Donations not limited and not tax deductible.