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Webinar Q&A: booth rentals, food sales and nonprofit exemptions explained
Summary
Department staff answered attendee questions: most unprepared food qualifies for the 4% state rate (local rates still apply), booth rentals are taxable unless the organizer is a 501(c)(3), and eligible nonprofits may host up to two tax-exempt events per year not exceeding 30 days.
During a question-and-answer segment, attendees asked whether food sales, admissions and booth-rental fees at special events are taxable. Billy Trout said most unprepared food items qualify for Tennessee’s reduced state sales-tax rate of 4%, but local sales-tax rates still apply and can vary by location. "If you collect a lower home-location local rate instead of the higher event location rate, you're left holding the bag," Trout said, warning vendors they may be liable for the difference.
Katie Julian and Martha Potter responded with practical mitigations: once a special-event location is added in TTAP, the system will apply the correct local rate for filings, and vendors should contact the Department before the 20th of the month following the event so staff can create the appropriate filing period. Martha Potter advised emailing revenue.support@tn.gov with event name, location, start and end dates and (if available) a promoter’s location ID to help the Department link vendors to events.
On admission charges and nonprofit exceptions, Trout said admissions are generally taxable but noted two exceptions mentioned in the webinar: (1) amusement tax equivalents do not apply to county or agricultural fairs; and (2) sales by organizations exempt under IRS code section 501(c)(3) may be nontaxable for up to two events per year lasting no more than 30 days each. For booth rentals, the panel confirmed that fees charged to vendors for booth space are taxable unless the organizer is a qualifying 501(c)(3).
What attendees should do next: register each event location with the Department or have vendors submit the special-event vendor registration application; use TTAP for filing; and email revenue.support@tn.gov with event details well in advance of the filing deadline.
