How to Get Your Indiana NP-1 Nonprofit Sales Tax Exemption Certificate

Indiana’s NP-1 nonprofit sales tax exemption certificate is not a form you download and complete on your own. You earn it by applying for nonprofit exemption status through Form NP-20A on the Indiana Department of Revenue’s INTIME portal, and once the department approves your application you can request NP-1 certificates to hand to vendors so they don’t charge the state’s 7 percent sales tax on qualifying purchases.¹²

Who Qualifies

Indiana Code 6-2.5-5-25 restricts the exemption to organizations that hold IRS tax-exempt recognition and are organized exclusively for religious, charitable, scientific, literary, educational, or civic purposes. Typical 501(c)(3) charities, churches, and schools fit, and so do united funds, cemetery associations, and certain fraternal or business league groups, provided no income flows to the private benefit of any member, trustee, or employee.³

One category is shut out: organizations operated predominantly for social purposes. If more than 50 percent of an organization’s spending goes toward social activities, the state treats it as a social organization and denies the exemption. Groups the IRS classifies as social organizations, including homeowners’ associations, are also excluded.⁴

How to Apply Through INTIME

Because the NP-1 is issued only after your nonprofit exemption is approved, the real application is Form NP-20A. Before you start, line up three things:

An IRS determination letter confirming your federal tax-exempt status.²
Awareness of the 120-day clock. Indiana law requires you to file the NP-20A within 120 days of your organization’s formation.³
Your ten-digit Indiana Taxpayer Identification Number (TID), assigned when you register with the state and often followed by a three-digit location code.

File the NP-20A electronically through INTIME at intime.dor.in.gov.² You’ll need your organization’s legal name as it appears in state records, mailing address, federal Employer Identification Number, and your IRS determination letter. Processing can take several weeks, so start as soon as your IRS determination arrives. Don’t wait until you’re at a register needing the discount.

Once the department approves your NP-20A, you request NP-1 certificates through INTIME.

Filling Out the NP-1

The certificate itself is short. It asks for:

The seller’s name and address.
A checkbox for whether the certificate covers a single purchase or a blanket (ongoing) arrangement with that vendor.
A description of what you’re buying, including whether lodging or meals are involved; if they are, you must state the exempt purpose those items serve.
Your organization’s name, department, contact details, and TID.
The signature and date of an authorized representative attesting the purchase qualifies.

The item description carries more weight than it looks like it does. Write something specific enough that an auditor reviewing the file years later can see how the purchase served your mission. “Office supplies for food-bank operations” reads clearly. “Miscellaneous” invites a problem.

What You Can and Cannot Buy Tax-Free

The exemption covers tangible personal property used to carry on your nonprofit’s purpose: office equipment for a charity’s headquarters, educational materials for a church school, lab supplies for a research organization. The transaction must be invoiced directly to the nonprofit and paid with the organization’s funds.⁴

Anything that benefits an individual member is not exempt, and this is where organizations most often slip:

Meals during meetings are taxable, because they benefit individual attendees rather than the organization’s mission.⁴
Hotel rooms for officers or members are taxable, because lodging is a private benefit to the individual staying in the room.⁴
If a member pays personally and gets reimbursed later, the purchase remains taxable at the point of sale. The exemption doesn’t apply retroactively through reimbursement.⁴
Any purchase used for social activities, such as parties, outings, or entertainment, is taxable regardless of your organization’s type.⁴

Single-Purchase Versus Blanket Certificates

When you fill in the NP-1, you check one of two boxes. A single-purchase certificate covers one transaction with that vendor. A blanket certificate stays on file with the vendor and covers all future qualifying purchases from that seller. If you buy from the same office-supply store every month, a blanket certificate saves everyone paperwork. For a one-off purchase from a vendor you may never visit again, use single-purchase.

A blanket certificate stays valid until your organization’s tax-exempt status changes. Some vendors periodically ask for a fresh copy for their records; sending an updated one promptly keeps things running.

The vendor is required to keep the certificate on file to justify why they didn’t collect sales tax.⁵ If an auditor arrives and the vendor cannot produce a valid certificate, the vendor becomes liable for the uncollected tax, which is why sellers are particular about getting the form before ringing up a tax-free sale.

Keeping the Exemption Active

Approval is not permanent. Indiana requires every exempt nonprofit to file a Nonprofit Organization’s Report (Form NP-20R) by May 15 every five years, electronically through INTIME, to remain registered.²³

If you miss the deadline, the Department of Revenue sends a notice. You have 60 days from that notice to file. If you still haven’t filed after 60 days, the department cancels your exemption. You can petition for reinstatement by showing reasonable cause, but every purchase between cancellation and reinstatement is fully taxable, so the safer path is filing on time.³

Because the Indiana exemption depends on IRS recognition, losing federal status ends the state exemption too. The most common way small nonprofits lose federal status is by not filing: the IRS automatically revokes tax-exempt status when an organization fails to file its required annual return (Form 990, 990-EZ, or 990-PF) or electronic notice (Form 990-N) for three consecutive years, effective on the due date of the third missed year.⁶

The NP-1 Doesn’t Cover Sales You Make

The NP-1 exempts your purchases. When your nonprofit sells goods to raise money, a different rule applies. Under Indiana Code 6-2.5-5-26, qualifying organizations can sell goods tax-free so long as total sales stay under $100,000 in both the current and previous calendar year, and the sales are made to raise money for the nonprofit purpose.⁷

Cross that threshold and you must register as a retail merchant and collect the 7 percent sales tax on subsequent sales for the rest of the calendar year. You stay registered until sales drop below $100,000 for two consecutive years. Churches, schools, and youth agricultural groups, among others, are exempt from the cap and can sell tax-free regardless of volume. Accredited colleges and universities are the reverse exception: they cannot claim this exemption on sales of books, stationery, supplies, or similar property, even though they qualify as exempt organizations when buying.⁷

1
Tax Foundation. 2026 Indiana Tax Rates and Rankings
2
Indiana Department of Revenue. Nonprofit Tax Forms
3
Indiana General Assembly. Indiana Code 6-2.5-5-25 – Exemption; Nonprofit Organizations; Uses to Carry on Its Not-for-Profit Purpose
4
Indiana Department of Revenue. Sales Tax Information Bulletin No. 10
5
Indiana Department of Revenue. Indiana General Sales Tax Exemption Certificate
6
Internal Revenue Service. Automatic Revocation of Exemption for Non-Filing: Frequently Asked Questions
7
Indiana General Assembly. Indiana Code 6-2.5-5-26 – Nonprofit Organizations; Less Than $100,000 in Sales