Georgia Sales Tax Exemption Extended

Georgia Sales Tax Exemption: Extended to Food Banks

The Georgia sales tax exemption is indefinitely extended to food banks, according to a bill signed by the Governor on August 5, 2020.

A food bank qualifies for the exemption if the food bank is exempt from taxation under Section 501(c)(3) of the Internal Revenue Code.  In addition, it must operate primarily for the purpose of providing hunger relief to low income persons residing in Georgia.

Letter of Authorization

To make tax exempt purchases, a qualified food bank must present a valid Letter of Authorization (“LOA”) to the seller.   The seller must retain a copy of the LOA for audit purposes.  Sellers are permitted to deliver food and food ingredients purchased with an LOA to any location operated by the food bank. 

To receive a refund of tax paid on food or food ingredients, a food bank must hold an LOA that is valid for the period in which the purchase was made.

To obtain an LOA, food banks must apply online through the Georgia Tax Center.  The  application requires the following information for the prior year:  Firstly, the applicant indicates the total number of clients served.  Secondly,  the applicant reports the total pounds of food donated by donors in the business of selling food.  Thirdly, applicant indicates the total dollar amount of exempt purchases made by the food bank. 

Taxpayers must apply for a new LOA annually.  LOA’s expire on June 30 each year. 

Please note that an LOA does not relieve food banks of the responsibility to remit sales tax on retail sales.

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Founded by Gary Massey, CPA, Massey and Company is a boutique CPA firm in located in Atlanta, Georgia serving the needs of small businesses and their owners.