NOTICE OF SUBSTANTIVE CHANGE
TYPE OF FILING: Amendment
1. Agency Information
2. Contact Persons
Please address questions regarding information on this notice to the persons listed above.
3. General Information
A. Rule or section catchline:
R865-19S-43. Sales to or by Religious and Charitable Institutions Pursuant to Utah Code Ann. Section 59-12-104
B. Purpose of the new rule or reason for the change:
In the 2026 General Session, the Legislature passed SB 276, Veteran Organization Amendments, sponsored by Senator Ann Millner. The bill allows an entity that is exempt from federal income taxation under Section 501(c)(3) or (19) of the Internal Revenue Code to claim an exemption from Utah sales and use tax as a religious or charitable institution.
This rule amendment reflects the changes in SB 276 (2026).
C. Summary of the new rule or change:
The rule amendment expands the sales and use tax exemption to include an organization recognized by the Internal Revenue Service under Section 501(c)(19) of the Internal Revenue Code.
The amendment also makes technical updates to the rule language.
4. Legislative Action Information
A. Are any changes in this filing
because of state legislative action?
Changes are because of legislative action.
B. If yes, any bill number and
session:
SB 276 (2026 General Session)
5. Fiscal Information
Provide an estimate and written explanation of the aggregate anticipated cost or savings to:
This proposed amendment is not expected to have any fiscal impact on state government revenues or expenditures because any fiscal impact would have been addressed in the legislative fiscal note for SB 276 (2026).
This proposed amendment is not expected to have any fiscal impact on local governments' revenues or expenditures because any fiscal impact would have been addressed in the legislative fiscal note for SB 276 (2026).
C. Small businesses ("small business" means a business employing 1-49 persons):
This proposed amendment is not expected to have any fiscal impact on small businesses' revenues or expenditures because any fiscal impact would have been addressed in the legislative fiscal note for SB 276 (2026).
D. Non-small businesses ("non-small business" means a business employing 50 or more persons):
This proposed amendment is not expected to have any fiscal impact on non-small businesses' revenues or expenditures because any fiscal impact would have been addressed in the legislative fiscal note for SB 276 (2026).
E. Persons other than small businesses, non-small businesses, state, or local government entities ("person" means any individual, partnership, corporation, association, governmental entity, or public or private organization of any character other than an agency):
This proposed amendment is not expected to result in costs or savings to persons other than small businesses or local governments because any fiscal impact would have been addressed in the legislative fiscal note for SB 276 (2026).
F. Compliance costs for affected persons:
This proposed rule is not expected to impose any compliance costs on affected persons because any fiscal impact would have been addressed in the legislative fiscal note for SB 276 (2026).
6. Regulatory Impact Summary Table
Enter the cost or savings in the relevant cell. If there is no cost or savings, enter, "$0." If a cost or savings is inestimable, enter, "inestimable."
7. Regulatory Impact Analysis Approval
The Commissioner of the Tax Commission, Rebecca L. Rockwell, has reviewed and approved this regulatory impact
analysis.
8. Family Impact Information
A. The agency has considered this rule's impact on family health, stability, and formation:
9. Citation Information
Provide citations to the statutory authority for the rule. If there is also a federal requirement for the rule, provide a citation to that requirement:
11. Public Notice Information
The public may submit written or oral comments to the agency identified in box 1.
A. Comments will be accepted until:
12. Effective Date Information
This rule change MAY become effective on:
(NOTE: This is the date the agency anticipates making the filing effective. It is NOT the effective date)
13. Agency Authorization Information
Agency head or
designee and title:
Rebecca Rockwell, Commissioner
R865. Tax Commission, Auditing.
R865-19S. Sales and Use Tax.
R865-19S-43. Sales to or by Religious and Charitable Institutions Pursuant to Utah Code Ann. Section 59-12-104.
[A.](1) [In order to]To qualify for [an]a sales and use tax exemption [from sales tax ]as a religious or charitable institution, an organization must be recognized by the Internal Revenue Service as exempt from tax under Section 501(c)(3) or (c)(19),[of the] Internal Revenue Code. [B.](2)(a) As used in Subsection (2)(b), "unrelated trade or business" means the same as that term is defined in Section 513, Internal Revenue Code. (b) Unless otherwise exempt by law, [R]religious and charitable institutions must report, collect, and remit sales or use tax to the Tax Commission on the sales price or purchase price of any sales or purchases[income] arising from an unrelated trade[s] or business[es and report that sales tax to the Tax Commission unless the sales are otherwise exempted by law].[1. The definition of the phrase "unrelated trades or businesses" shall be the definition of that phrase in 26 U.S.C.A. Section 513 (West Supp. 1993), which is adopted and incorporated by reference. C. Every institution claiming exemption from sales tax under this rule must submit f](3)(a) An organization that seeks to claim a sales or use tax exemption for religious or charitable institutions shall submit Form TC-160, Application for Sales Tax Exemption Number for Religious or Charitable Institutions, along with any other information [that form]Form TC-160 requires, to the Tax Commission for its determination.[ Vendors making sales to institutions exempt from sales tax are subject to the requirements of] (b) A seller that makes a sale to a religious or charitable institution is subject to [Rule]Section R865-19S-23. KEY: charities, tax exemptions, religious activities, sales tax
Date of Last Change: [January 1,] 2026 Notice of Continuation: November 9, 2021
Authorizing, and Implemented or Interpreted Law: 9-2-1702; 9-2-1703; 10-1-303; 10-1-306; 10-1-307; 10-1-405; 19-6-808; 26-32a-101 through 26-32a-113; 59-1-210; 59-12; 59-12-102; 59-12-103; 59-12-104; 59-12-105; 59-12-106; 59-12-107; 59-12-108; 59-12-118; 59-12-301; 59-12-352; 59-12-353
!--dar--
