craft:Ed's Sales Tax Policy - FAQ's
1. What is craft:Ed's policy regarding Tennessee State Sales Tax?
As part of the application process, you will be provided a letter from craft:Ed and a Special Event Vendor Registration Form from the Tennessee Department of Revenue. You will also be asked to sign craft:Ed's "Sales Tax Acknowledgement Form." Signing the Sales Tax Acknowledgement Form is required for participation in craft:Ed.
2. Am I required to collect Sales Tax to participate in craft:Ed?
craft:Ed does not monitor sales tax compliance. Your business decision concerning whether you will collect sales tax or not is completely an individual decision and is not impacted by the forms craft:Ed requires you to sign.
3. What are the Tennessee State Sales Tax requirements?
While we cannot provide advice on sales tax requirements, the Tennessee Department of Revenue’s website states the following:
“Any person who sells, leases, or rents tangible personal property or provides a taxable service is required to register for sales and use tax purposes, even if the product sold is exempt from tax. Businesses that average more than $400 a month in sales of tangible personal property and businesses averaging more than $100 per month in sales of taxable services must register for sales and use tax purposes.”
4. Why do I have to sign a Sales Tax Acknowledgement Form to participate in craft:Ed?
craft:Ed is a non-profit organization that operates events on public school property and supports public school organizations. In order to protect our non-profit status and insure our continued ability to support the local music programs, craft:Ed must be legally compliant at all times.
Under Tennessee law, craft:Ed (like every vendor market held in the state) is considered a Special Event. The Tennessee Department of Revenue defines a “Special Event” as:
“an event held in a Tennessee community usually lasting for a short time, featuring a theme such as arts and crafts, home show, or a holiday themed event, where vendors are available in a concentrated geographical location.”
The Tennessee Department of Revenue requires promoters of Special Events to: “Register their special events with the Tennessee Department of Revenue …” and “supply each vendor attending the event a letter informing them of their tax responsibilities, the event information, and the special event vendor registration form.”
The required Sales Tax Acknowledgement Form is a statement by you that craft:Ed provided you with the required letter and registration form and nothing more. The form permits craft:Ed to easily prove its legal compliance in the event that compliance is ever questioned. The form has no other use or purpose and is not shared with anyone outside the craft:Ed organization.
5. Does signing the Sales Tax Acknowledgement Form expose me to scrutiny from the Tennessee Department of Revenue?
NO. The Tennessee Department of Revenue does not require Special Event promoters to report the names of vendors who sell at their events. Promoters are not required to track or report vendor sales, collect sales tax, or participate in any way in the administration or collection of sales tax.
Any risk you have related to collecting and remitting sales tax remains an issue between you and the State of Tennessee. Avoiding knowledge of your filing requirements will not protect you from the Department of Revenue’s sales tax enforcement efforts. Whether or not to collect and remit sales tax is a business choice you make. craft:Ed has no opinion of, or involvement in, that decision and accepts no responsibility related to that decision.
Every vendor market you participate in is required to provide you with the sales tax letter and registration form. Their failure to do so does not change your responsibilities related to sales tax or protect you in any way from the Department of Revenue’s sales tax enforcement efforts.