State level

Suggestions for Simplifying State Nonprofit Tax Laws

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Problem #1: The sales tax refund process is less efficient than a system of tax exemption

Problem #2: State law allows the IRS to arbitrarily deny sales tax refunds to some North Carolina nonprofits

Problem #3: Nonprofits are confused whether they need to collect and remit sales tax on their fundraising events

Problem #4: The exemption from sales tax on admission fees for “volunteer-only” nonprofits is confusing and unnecessary

Nonprofit Tax Exemption Talking Points

Why Is Nonprofit Tax Exemption Essential for North Carolina?

1. It protects taxpayers.

  • Nonprofits provide essential services that government would have to provide otherwise. Tax exemption costs much less than the cost of government having to provide the services itself.
  • Nonprofits provide public benefits in exchange for tax exemption.
  • Organizations may choose not to locate in counties or states that do not grant tax exemption. This is a potential loss for the people and economy in those locations.

Charitable Giving Cap

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Capping State Itemized Deductions Would Reduce Charitable Giving In North Carolina

North Carolina’s nonprofit sector is concerned that the $20,000 cap on itemized deductions in the Senate budget would harm communities across the state by reducing charitable giving.  

  • North Carolinians gave $5.9 billion in charitable contributions in 2012, the most recent year for which federal income tax data is available.  

Election Law Changes and Nonprofits

 

In August 2013, the N.C. General Assembly passed H.B. 589, the Voter Information Verification Act (VIVA), which makes several significant changes to North Carolina’s election laws.  Legislators made important changes to this law in June of 2015.  Because nonprofits are among the most trusted institutions in their communities, it is important that they provide accurate, nonpartisan information to their staff, volunteers, and those they serve about the election process.