Making University Purchases

The University of Minnesota can purchase many items exempt from state and local sales taxes.

In the state of Minnesota, this exemption does not apply to lodging, pFebruary 18, 2009 services, or construction materials purchased by a contractor. IFebruary 18, 2009 10:13 AMFebruary 18, 2009 10:13 AMclass="style1">The procedure for making University tax exempt purchases in Minnesota is simple:

1. Use your University Purchasing Card

Minnesota state statute requires that the University of Minnesota DIRECTLY PAY for any items purchased with the University's tax exemption. This means that the only acceptable forms of payment are the University issued purchasing card, University purchase order, and University issued check. The exemption CANNOT be used when an employee pays for items with their own funds (cash, check, or credit card) EVEN IF they will be reimbursed by the University later. Nor can the exemption be used with gift cards or gift certificates - even if issued to the department, gift cards/certificates are considered a cash equivilent by the IRS. Penalty for improper use of the University's tax exemption may be a fine to the user in the amount of $100 per transaction. For more information on the P-Card and tax exemption, see this article by Heather Broneak from the Dollars and Sense newsletter.

An official U of M check is also considered direct payment. If the retailer will invoice the University or accept a purchase order, those payments will also be made via University check and are acceptable ways to purchase.

Cash is never an acceptable tender when using the MN sales tax exemption, even if the cash was provided by the U of M department or through a cash advance.

2. Bring an ST-3 Form

The ST-3 form is the Minnesota Department of Revenue Certificate of Exemption. You can download and print a copy of this certification that is signed by the University Tax Director here. Fill in the seller name and address as appropriate. DO NOT change the address or name, though you may wish to draw the vendor's attention to the note regarding billing/correspondence address at the bottom of the page.

3. Check for exemption numbers, accounts, or special procedures for some popular retailers.

Some retailers have their own additional processes for veryifing tax exempt sales. You can click here for a list of some known retailers that have assigned the University customer codes or other important numbers, or who require specific procedures to be followed.

4. Inform the cashier of your tax exempt stFebruary 18, 2009 10:11 AMsed.January 13, 2009 9:21 AMr sale.

 

Sales Tax Status in Other States

Sales tax procedures are different in every state. The University does have sales tax agreements with several other states, so if you will be making purchases in another state, please click here to for more information.

 

Sales Tax Status in Other Countries

Generally, the University’s exemption does not carry over to foreign transactions. However, facts and circumstances may impact whether tax, such as a value added tax (VAT), may be refundable to the University. Consequently, please contact the University Tax Management Office when paying a significant amount of tax in a foreign county.

 

Taxes on Fuel Purchases

There are several different taxes on fuel, treated in different ways. Please click HERE for guidance on purchasing gasoline fuel with University funds.