Guidance, Forms, and Exemptions
For purchasing specific guidance and policies, please visit the Strategic Procurement website.
Tax Exempt Status
The University, as a nonprofit educational institution, is exempt from Massachusetts sales and use tax and from sales and use tax in many other states and from federal excise tax. Since sales taxes are generally imposed only when goods are bought and consumed in the same state, sales tax does not apply when goods are ordered from an out-of-state firm and shipped to Harvard.
501(c)(3) Non-Profit Status
Harvard University is registered as a 501(c)(3) non-profit organization with the US IRS. This means that Harvard University is a non-profit organization for income tax purposes. Although the 501(c)(3) document signifies that Harvard is a tax exempt organization, the document itself is typically not provided to vendors for sales tax exemption purposes.
Responsibilities
Harvard University requires that faculty, staff, researchers, and students who plan for or purchase products, equipment, supplies, and services with University funds base purchases on sound business practice, best value, accountability, and compliance with donor, sponsor and regulatory requirements. Individuals making purchases must follow established Harvard University policies and procedures.
Harvard’s tax exempt certificate may only be used for legitimate Harvard business purposes. The tax exempt certificate cannot be used for personal purchases or purchases for students groups which may have their own Tax ID number. Using the tax exempt number for non-Harvard business can jeopardize the University’s tax exempt status. In addition, inappropriate use may also be subject to disciplinary action up to and including termination of employment.
|
Tax Type |
Harvard Expenses:
Expenses billed to Harvard, paid by University Corporate Card(s) or PCard, or out-of-pocket reimbursement
|
|---|---|
| Sales Tax | |
| Purchased in Massachusetts | Exempt3 - Provide ST-2 and ST-5 Forms to vendor as requested |
| Purchased outside of Massachusetts; Item to be used in Massachusetts | Exempt3 - Provide ST-2 and ST-5 Forms to vendor as requested |
| Purchased outside of Massachusetts; Item to be used outside of Massachusetts | May be Exempt3 - See list of exemptions for other states |
|
Meals Tax (also known as food sales tax)
|
|
| Purchased in Massachusetts | Exempt1 - Provide ST-2 and ST-5 Forms to vendor as requested |
| Purchased Outside Massachusetts | May be Exempt1 - See list of exemptions for other states |
| Room Tax (also known as occupancy or hotel tax) | |
| Purchased in Massachusetts | Not Exempt2 |
| Purchased Outside Massachusetts | May be Exempt2 - See list of exemptions for other states |
| Value Added Tax (VAT) | |
| VAT is a general, broadly based consumption tax assessed in many foreign countries on the value added to goods and services. Purchases of goods or services to be used in the US should not have to pay VAT. See Office of the Controller Tax Office or contact taxcompliance@harvard.edu for additional information. | |
1Meals Tax
The University is exempt from Massachusetts (and may be exempt in other states) Meals Tax under the following conditions:
- For a catered event or when an outside organization, such as a caterer, restaurant, or hotel is hired to provide meals for students, employees or Harvard guests.
- Individuals paying for a Harvard business meal using a PCard, Corporate Card, invoice or out-of-pocket are exempt from MA Meals and should take advantage of this exemption by presenting ST-2 and ST-5 forms when requested by the vendor.
2Room Tax (also known as occupancy or hotel tax)
Harvard is not exempt from Massachusetts room tax or required fees charged by hotels, motels, and inns, but may be exempt in other states. See a list of other state exemptions and required forms.
3Sales or Use Tax
- Harvard is exempt from Massachusetts sales tax for purchases made in Massachusetts.
- Harvard is exempt from Massachusetts use tax for purchases made outside Massachusetts but the purchased items are used in Massachusetts. This includes out-of-state on-line or telephone orders of items being shipped to and used in Massachusetts. This also includes items purchased outside of Massachusetts in-person but brought back to Massachusetts for use in Massachusetts.
- In-person purchases made outside of Massachusetts may be exempt, see the list of exemptions for other states and use any documents that apply.
Tax Forms
Based on where the services were performed or where the goods will be used, certain documents may need to be presented to take advantage of tax exemptions.
See Tax Forms for the complete list of tax forms when requesting exemptions.
The two most important documents for Massachusetts sales tax exemption are the ST-2 and the ST-5.
- The ST-2 document states that Harvard University has been granted exemption from sales tax for purchases by the Commonwealth of Massachusetts.
- The ST-5 document is a certification that states a specific individual is making a purchase on behalf of Harvard University, and therefore it is exempt from sales tax. The account holder/purchaser or school’s Procurement or Finance Office must complete and sign the Agent Information section (Part 2) if required by the vendor.
- The ST-5C is only used for contractors or subcontractors of Harvard University purchasing materials on Harvard’s behalf. This document is rarely needed by the majority of the purchasing community. The account holder/purchaser or school’s Procurement or Finance Office must complete and sign the Agent Information section (Part A).
W-9
The W-9 is used for tax reporting purposes, much like an individual’s social security number and may be sent to vendors upon request. See DUNS, Tax ID and EIN Numbers for more information.