August 20, 2002
State Law Allow Florida PTOs, PTAs to Buy Tax-free
As more than 2 million Florida students head back to school, Florida law is helping the state's Parent-Teacher Organizations and Parent-Teacher Associations stretch their budgets a little further by making it easier for them to make purchases or leases tax-free, the Florida Department of Revenue announced Tuesday.
Under current law, Florida PTOs and PTAs that are involved in K-12 schools may qualify for a Florida sales tax exemption, allowing them to buy taxable items and lease property tax-free. To receive tax-free purchasing status, PTAs and PTOs should apply for a Consumer's Certificate of Exemption from DOR. Applying for the consumer's certificate of exemption is simple and easy. Application forms (form DR-5) are available on-line, by fax or from any DOR service center.
Some restrictions to the exemption apply, however:
- The PTO or PTA may use its Consumer's Certificate of Exemption only for direct purchases and leases using the PTO's or PTA's own funds. If PTO or PTA members make purchases with personal funds on behalf of the organization, those purchases are taxable, even if the purchaser has a copy of the organization's exemption certificate and plans to be reimbursed by the organization.
- State law limits this exemption to items purchased or leased by the PTO or PTA. The consumer's certificate of exemption does not qualify the PTO or PTA to sell or lease items tax-free. PTOs and PTAs continue to have the option of paying sales tax to their suppliers on items that they buy to resell for fund-raising, or collecting tax on taxable items when they sell them to customers. If the PTO or PTA pays sales tax on the cost to purchase the item from a supplier, tax should not be collected from the customer.
If a PTO or PTA wishes to buy items tax-free for later resale, the PTO or PTA must follow the same rules that apply to all other sellers of taxable items. It must register as a business with the Department of Revenue, receive an annual sales tax resale exemption certificate from DOR, provide a copy of that certificate to its supplier, collect tax when it sells the item to a customer and file regular sales tax returns.
- A PTO or PTA may continue to ask its school districts to purchase goods and services tax free for the PTO or PTA. It is not necessary for the PTO or PTA to obtain its own tax exemption certificate to do this.
The sales tax exemption for PTOs and PTAs became effective July 1, 2000. State law provides that tax that should have been paid prior to this date, but was not, is not owed to the state. However, if a PTA paid or collected and remitted tax before receiving a consumer's certificate of exemption, no refund may be obtained.
To receive a Consumer's Certificate of Exemption, the PTO or PTA must submit a completed Application for Consumer's Certificate of Exemption (form DR-5) to the Florida Department of Revenue along with a copy of its by-laws. An Application for Consumer's Certificate of Exemption (DR-5) and an Application to Collect and/or Report Tax in Florida (form DR-1) may be obtained in any of the following ways:
- Fax-on-Demand: Call 850-922-3676 using the telephone on your fax machine. Follow the instructions and request document number 1027 for a form DR-5.
- Fax: Fax your request to 850-922-2208. Be sure to include the form number (DR-5) and provide your mailing address.
- Telephone: Call the Florida Department of Revenue Distribution Center at 850-488-8422. Hearing or speech impaired persons should call the TDD at 800-367-8331 or 850-922-1115.
- Mail: Mail your request to: Distribution Center, Florida Department of Revenue, 168A Blountstown Hwy, Tallahassee, FL 32304-3702.
- Internet: You may download or order a form through our Internet site at www.myflorida.com/dor. Click on the "Forms" link in the green navigation bar at the top of the DOR Internet homepage, then click on "Download current forms" in the center of the "Forms" page. On the "Download Current Tax Year Forms" page, choose the "Sales and Use Tax" category from the menu near the top center of the page, then scroll down and look for "DR-5". You must have Adobe Acrobat 4.0 or higher to use this service.
- Service Centers: Visit or call the Department of Revenue service center nearest you. Service center addresses and phone numbers are available in the Blue Pages (Government Listings) of your telephone directory, or through our Internet site at www.myflorida.com/dor.
For additional information, call DOR's taxpayer hotline from 8 a.m. to 7 p.m. ET, Monday through Friday, excluding holidays, at 800-352-3671 (Florida only). You may also visit or call the nearest Department of Revenue service center. Information on your local service center is available on the DOR website (http://www.myflorida.com/dor ) or in the Blue Pages (Government Listings) of your local telephone directory.