1. Sales Tax Issues For California Churches Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012 1

2. The information contained herein is intended provided general and educational in nature, and is not intended to be, and should not be construed as, legal or tax advice. Laws of specific state or laws relevant to a particular situation may affect the applicability, accuracy or completeness of this information. Federal and state laws and regulations are complex and subject to change. David Rutledge disclaims any liability arising out of your use of or reliance on, the information. For specific tax information about your own personal situation, consult your own attorney or accountant.

3. Info@yourchurchmatters.comInfo@yourchurchmatters.com ©2012 Sales Tax Issues For California Churches Sales Tax Issues For California Churches Each State’s Sales Tax Regulations Are Different If you have church members that are involved in other Non Profit organizations – Sales Tax varies for different Non Profits – Check out BOE for churches

4. Info@yourchurchmatters.comInfo@yourchurchmatters.com ©2012 Sales Tax Issues For California Churches Sales Tax Issues For California Churches Out of State Purchases Without Sales Tax = USE TAX

5. Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012 Sales Tax Issues For California Churches Sales Tax Issues For California Churches How To Pay Use Tax If you are not paying other sales tax Form BOE – 401-DS Use Tax BOE Pub. 79B Due: January 31, Following the end of tax year www.boe.com

6. Collecting Sales Tax Selling Tangible Personal Property Sales tax usually needs to be collected and sent to the state of CA Sales Tax Issues For California Churches Sales Tax Issues For California Churches Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012

7. Sales Tax added to the purchase price Sale Price $1,000 Sales Tax Rate 10% Tax: $100 $1,000 x 10% = $100 Sales Tax Issues For California Churches Sales Tax Issues For California Churches Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012

8. Sales Tax included in the purchase price Sale Price $1,000 Sales Tax Rate 10% Tax: $90.91 $1,000 / 110% = $909.09, cost of item $909.09 x 10% = $90.91 $ 909.09 (cost) + $90.91(tax) = $1,000 Sales Tax Issues For California Churches Sales Tax Issues For California Churches Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012

9. Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012 Tangible Personal Property Tangible Personal Property Tangible Personal Property is property that may be seen, weighed, measured, felt, or touched or which in any other manner perceptible to the senses. Sales Tax Issues For California Churches Sales Tax Issues For California Churches

10. Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012 What Is a Sale A sale is any transfer of title of tangible personal property for consideration. Sales Tax Issues For California Churches Sales Tax Issues For California Churches

11. Collecting Sales Tax Unless your sales have a special exemption from sales tax, all sales that a church makes are subject to sales tax Sales Tax Issues For California Churches Sales Tax Issues For California Churches Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012

12. Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012 Sales tax application Form BOE – 400 SPA www.boe.ca.gov Left side : Forms & Publications : Sales and Use Tax Sales Tax Issues For California Churches Sales Tax Issues For California Churches

13. Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012 Items That A Church Might Sell 1. 1. Food at different times -Wed. night 2. 2. Books for bible studies 3. 3. Sale of items at rummage sales 4. 4. Sale of items at live or silent auctions 5. 5. Vending machine items Sales Tax Issues For California Churches Sales Tax Issues For California Churches

14. Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012 Meals at Church NO SALES TAX if all 3 conditions are met 1. You sell the food at a social or other gathering you conduct 2. You furnish the meals to raise funds for your organization 3. You use the proceeds to carry out those functions and activities Sales Tax Issues For California Churches Sales Tax Issues For California Churches

15. Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012 Pub. 18, Nonprofit Organization Pub. 42, Resale Certificate Tips Pub. 51, Guide to Board of Equalization Services Pub. 61, Sales and Use Taxes: Exemptions & Exclusions Pub. 71, Sales and Use Tax Rate Pub. 73, Your Calif. Seller’s Permit Pub. 103, Sales for Resale Pub. 110, Calif. Use Tax Basics BOE-230 General Resale Certificate BOE 400-SPA, CA Seller’s Permit Application www.boe.ca.gov

16. Info@yourchurchmatters.comInfo@yourchurchmatters.com © 2012 David Rutledge EA, CEP, RFC David Rutledge EA, CEP, RFC info@yourchurchmatters.com info@yourchurchmatters.com info@yourchurchmatters.com 800 – 669 – 1040 800 – 669 – 1040 www.yourchurchmatters.com www.yourchurchmatters.com www.yourchurchmatters.com Sales Tax Issues For California Churches Sales Tax Issues For California Churches