DOR Taxation web site

Sales Tax Collection

Sales by Charitable Organizations

Charitable organizations which hold IRS section 501(c)(3) qualification letters and have a Colorado exemption certificate may be exempt from collecting sales tax during fundraising events.

 

If the charitable organization conducts sales for a total of 12 days or less during a calendar year and the net proceeds from all these events do not exceed $25,000 in that calendar year, the sales are not subject to sales tax. As soon as the organization reaches either $25,000 in net proceeds, or conducts sales for more than 12 days a year it must obtain a sales tax license from the department and begin collecting sales tax.

 

Charitable organizations should contact their local government to find out if a similar exemption is allowed for local taxes. For local tax rates in cities and counties where the state administers the tax, organizations may refer to the publication Colorado Sales/Use Tax Rates (DR 1002).

If the local jurisdiction is a state-collected tax jurisdiction that does not allow the exemption, the charitable organization should obtain a Colorado sales tax license so that the organization can report and pay local tax to the department.

 

Sales by Other Tax-Exempt Organizations

Other tax-exempt organizations (including governmental entities) that sell tangible personal property (for example, through a secondhand goods retail store, a fundraiser sales event or routine sales of organization-related items) must obtain a sales tax license and collect all applicable state and local sales taxes.