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socrateaser, Lawyer
Category: Tax
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Experience:  Retired (mostly)
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We are a 501c3 that manages primarily govt grants and contracts.

Resolved Question:

We are a 501c3 that manages primarily govt grants and contracts. We are making a purchase in North Dakota for equipment that will be used in South Dakota. The question I have is whether or not we have to pay South Dakota sales tax, excise tax, use tax or any other tax or not. As an organization, we are exempt only from income tax. Because the purchase is being made on behalf of a govt entity, can the purchase be considered tax exempt? Once the grant has ended the ownership of the property will be shifted to the government.
Submitted: 5 years ago.
Category: Tax
Expert:  socrateaser replied 5 years ago.

Unless you are actually a "purchasing agent" of the federal government (i.e., subject to an obligation to purchase assets on its behalf), then you cannot avoid sales or use tax, because your organization will be purchasing and using the merchandise.

Hope this helps.

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