Michigan Administrative Code › Department - Treasury › Bureau of Tax & Economic Policy › General Sales and Use Tax Rules › SPECIFIC SALES AND USE TAX RULES › Section R. 205.74 - Educational institutions

Current through Vol. 24-12, July 15, 2024
Rule 24.
(1)
				  Sales, not for resale, to regularly organized educational institutions not
				  operated for profit are not taxable. "Not operated for profit," as used in this
				  rule, means operated by an entity of government, a regularly organized church,
				  religious or fraternal organization, where the income from the operation does
				  not inure, in whole or in part, to the benefit of individuals or private
				  shareholders, directly or indirectly, and where the activities of the entity
				  are carried on exclusively for the benefit of the public at large and are not
				  limited to the advantage, interests, or benefits of its members or a restricted
				  group. "Educational institution," as used in this rule, means an institution of
				  learning, organized solely for educational purposes, which maintains a faculty
				  of qualified instructors, and teaches regular, continuous courses of study, and
				  which confers upon students a recognized diploma after completion of a specific
				  curriculum.
(2) Sales of athletic
				  equipment to a regularly organized educational institution for consumption or
				  use are not taxable if the athletic activities are under the management and
				  control of the educational institution and the entire receipts are expended for
				  athletic or educational purposes.
(3) Educational institutions which are not
				  operated for profit, and which operate lunchrooms, cafeterias, or dining rooms
				  for the exclusive use of bona fide enrolled students, are not taxable. Whenever
				  such a lunchroom, school cafeteria, or dining room sells to nonstudents,
				  including teachers, the institution operating it is subject to the tax on those
				  sales.
(4) Sales of class pins,
				  rings, and similar articles are taxable when paid for, directly or indirectly,
				  by the students.
(5) Sales to
				  educational associations, parent teacher organizations, teachers, and other
				  personnel of an educational institution are taxable.
(6) If an exemption is claimed, then at the
				  time of the transfer of the tangible personal property, the seller shall
				  retain, as part of the seller's records, an executed exemption certificate
				  which reads as follows:
CERTIFICATE TO BE EXECUTED WHEN TAX EXEMPT SALE IS MADE TO
					 AN EXEMPT INSTITUTION OR AGENCY
The undersigned hereby certifies that the item or items
					 being purchased are to be used or consumed in connection with the operation of
					 the exempt institution or agency named in the space provided below and that the
					 consideration for this purchase moves from the funds of the designated
					 institution or agency. In the event this claim is disallowed the transferee
					 promises to reimburse the seller for the amount of tax involved.
_________________________________________________
Name of exempt institution or agency
Date ___________________________
__________________________________________________
Signature and title of person making certification
(7) Schools operating a kindergarten through
				  twelfth grade program are not required to pay tax on the sales of textbooks to
				  enrolled students. Sales of textbooks to nonstudents are taxable. Sales of
				  yearbooks and annuals to both students and nonstudents are taxable.