34 Tex. Admin. Code § 3.161 - Definitions, Exemptions, and Exemption Certificate
(a) Definitions. The following words and
terms, when used in this subchapter, shall have the following meanings, unless
the context clearly indicates otherwise.
(1)
Charitable or eleemosynary organization--A nonprofit organization devoting all
or substantially all of its activities to the alleviation of poverty, disease,
pain, and suffering by providing food, clothing, medicine, medical treatment,
shelter, or psychological counseling directly to indigent or similarly
deserving members of society with its funds derived primarily from sources
other than fees or charges for its services. If the organization engages in any
substantial activity other than the activities described in this section, and
those activities do not support or further the charitable purpose of that
entity, it will not be considered as having been organized for purely public
charity, and therefore, will not qualify for exemption under this provision. No
part of the net earnings of the organization may inure to the benefit of any
private party or individual other than as reasonable compensation for services
rendered to the organization. Some examples of organizations that do not meet
the definition of a charitable or eleemosynary organization are fraternal
organizations, lodges, fraternities, sororities, service clubs, veterans
groups, mutual benefit or social groups, professional groups, trade or business
groups, trade associations, medical associations, chambers of commerce, and
similar organizations. Even though not organized for profit and performing
services that are often charitable in nature, these types of organizations do
not meet the requirements for exemption under this provision.
(2) Educational organization--A nonprofit
organization or governmental entity whose activities are devoted solely to
systematic instruction, particularly in the commonly accepted arts, sciences,
and vocations, and has a regularly scheduled curriculum, using the commonly
accepted methods of teaching, a faculty of qualified instructors, and an
enrolled student body or students in attendance at a place where the
educational activities are regularly conducted. An organization that has
activities consisting solely of presenting discussion groups, forums, panels,
lectures, or other similar programs, may qualify for exemption under this
provision, if the presentations provide instruction in the commonly accepted
arts, sciences, and vocations. The organization will not be considered for
exemption under this provision if the systematic instruction or educational
classes are incidental to some other facet of the organization's activities. No
part of the net earnings of the organization may inure to the benefit of any
private party or individual other than as reasonable compensation for services
rendered to the organization. Some examples of organizations that do not meet
the requirements for exemption under this definition are professional
associations, business leagues, information resource groups, research
organizations, support groups, home schools, and organizations that merely
disseminate information by distributing printed publications. Entities that are
defined in Education Code, §
61.003, as Texas
public or private "institutions of higher education" are recognized for
exemption under this provision. Included in the definition of "institutions of
higher education" is any public technical institute, public junior college,
public senior college or university, medical or dental unit, public state
college, or other agency of higher education as identified in Education Code,
§
61.003. A Texas
private "institution of higher education" is a private or independent
university or college that is organized under the Texas Non-Profit Corporation
Act; exempt from taxation under Article VIII, §2, of the Texas
Constitution and §
501(c)(3) of the Internal
Revenue Code of 1986 (26 U.S.C.
§501); and accredited by the Southern
Association of Colleges and Schools. Beginning October 1, 2003, public and
private "institutions of higher education" from other states or countries do
not meet the requirements for exemption under this provision.
(3) Hotel--Any building or buildings in which
members of the public obtain sleeping accommodations for a consideration. The
term includes, in addition to the buildings listed in Tax Code, §
156.001, manufactured homes,
skid mounted bunk houses, residency inns, condominiums, cabins, and
cottages.
(4) Permanent Resident--A
person who has the right to use or occupy a room or space in a hotel for at
least 30 consecutive days without interruption. A person may be an individual,
organization, or entity.
(5)
Private Club--An organization that provides members entertainment, recreation,
sport, dining, social facilities, or other significant club amenities and
assesses membership dues, initiation fees, and other charges, assessments, and
fees for special privileges or status not available to the general public. The
rental of a room is insignificant to the purpose or purposes of the
organization and members pay the membership dues, initiation fees, and other
charges, assessments, and fees not just for the right to rent a room but for
other significant club amenities.
(6) Religious organization--A nonprofit
organization that is an organized group of people regularly meeting for the
primary purpose of holding, conducting and sponsoring religious worship
services, according to the rights of their sect. The organization must be able
to provide evidence of an established congregation showing that there is an
organized group of people regularly attending these services. An organization
that supports and encourages religion as an incidental part of its overall
purpose, or one whose general purpose is furthering religious work or
instilling its membership with a religious understanding, will not qualify for
exemption under this provision. No part of the net earnings of the organization
may inure to the benefit of any private party or individual other than as
reasonable compensation for services rendered to the organization. Some
examples of organizations that do not meet the requirements for exemption under
this definition are conventions or associations of churches, evangelistic
associations, churches with membership consisting of family members only,
missionary organizations and groups who meet for the purpose of holding prayer
meetings, bible study or revivals.
(b) Exemptions. This subsection deals with
exemptions from the state hotel occupancy tax. For information on city and
county hotel taxes, contact the affected city or county.
(1) Religious, charitable, and educational
organizations and their employees, including college and university personnel,
traveling on official business of the organization are exempt from payment of
hotel occupancy tax.
(2) State
officials, judicial officers, heads of state agencies, the Executive Director
of the Legislative Council, the Secretary of the Senate, state legislators,
legislative employees, members of state boards and commissions, and designated
state employees of the State of Texas who present a Hotel Tax Exemption Photo
Identification Card when traveling on official state business are exempt from
the hotel occupancy tax. State agency, institution, board, or commission
employees who have not been issued a Hotel Tax Exemption Photo Identification
Card must pay the hotel occupancy tax. The hotel tax paid by the state or
reimbursed to a state employee may be refunded as provided in §
3.163 of this title (relating to
Refund of Hotel Occupancy Tax). For the purpose of claiming an exemption, a
Hotel Tax Exemption Photo Identification Card includes:
(A) any photo identification card issued by a
state agency that states "EXEMPT FROM HOTEL OCCUPANCY TAX, under Tax Code,
§
156.103(d)",
or similar wording; or
(B) a Hotel
Tax Exemption Card that states "when presented with a photo identification card
issued by a Texas agency, the holder of this card is exempt from state,
municipal, and county hotel occupancy tax, Tax Code, §
156.103(d)",
or similar wording.
(3)
The United States government and its employees traveling on official business
representing the United States government are exempt from the hotel occupancy
tax.
(4) Diplomatic personnel of a
foreign government who present an appropriate Tax Exemption Card issued by the
United States Department of State are exempt from the tax.
(5) If an exemption applies, then the
organization or individual claiming exemption must present an exemption
certificate to the hotel.
(6)
Permanent residents are exempt from payment of hotel occupancy tax.
(A) A permanent resident is exempt beginning
on:
(i) the first day for which the resident
has entered into a written agreement with the hotel or has given a written
notice to the hotel of the resident's intent to use or occupy a room or space
in the hotel for the next 30 or more consecutive days and the resident actually
stays for at least the next 30 consecutive days; or
(ii) the first day after the 30th consecutive
day of the stay, if the resident neither gave written notice of intent to stay,
nor entered into any written agreement with the hotel. For example, if a person
does not notify the hotel that he intends to stay for at least 30 days, but
stays 35 days, then the person is exempt from hotel tax from the 31st day
through the 35th day, but tax is due on the first 30 consecutive days of the
occupancy.
(B) The
permanent resident exemption ends when an interruption in the right to use or
occupy the room or space occurs.
(C) Permanent residents are not required to
physically occupy a room or space.
(D) Permanent residents may have the right to
use or occupy different rooms in the same hotel without loss of the permanent
resident exemption.
(E) The
permanent resident exemption applies to the lowest number of rooms in a written
notice, agreement, or contract for a range of rooms plus the number of rooms
that qualify for the permanent resident exemption under subparagraph (A)(ii) of
this paragraph.
(c) Exemption certificate.
(1) Any organization or individual claiming
exemption from the payment of hotel occupancy tax must furnish the hotel with a
signed exemption certificate.
(2)
The rental of a room or space in a hotel is exempt from tax if the person
required to collect the tax receives, in good faith from a guest, a properly
completed exemption certificate stating that the guest qualifies for exemption
under Tax Code, §
156.102 or §
156.103 or other law. The
exemption certificate must be supported by the following documentation:
(A) for persons traveling on official
business of the federal government, a valid government identification
card;
(B) for state officials
exempted by Tax Code, §
156.103(d),
a Hotel Tax Photo Identification Card, as described in subsection (b)(2)(A) or
(B) of this section;
(C) for
diplomatic personnel of a foreign government, the appropriate Tax Exemption
Card issued by the United States Department of State;
(D) for persons traveling on official
business of a charitable, educational, or religious organization, as defined in
subsection (a)(1), (2) or (6) of this section:
(i) a letter of hotel tax exemption issued by
the Comptroller of Public Accounts; or
(ii) verification that the organization is on
the comptroller's list of entities that have been provided a letter of
exemption; such as, a printed copy of the Comptroller of Public Accounts
Internet Web site listing the organization as exempt for hotel tax.
(E) For persons traveling on
official business of an organization exempt by law other than Tax Code, Chapter
156:
(i) a letter of hotel tax exemption
issued by the Comptroller of Public Accounts; or
(ii) verification that the organization is on
the comptroller's list of entities that have been provided a letter of
exemption.
(F) The
manner of payment by an employee of an exempt organization does not affect the
exemption. To claim an exemption a nonemployee traveling on behalf of an exempt
organization must pay the hotel directly with the organization's funds, by
organization check, organization credit card, or direct billing to the
organization by the hotel.
(3) A hotel claiming exemption of its
receipts from hotel occupancy tax must provide proof that the receipts were
exempt, either through exemption certificates or other competent
evidence.
(4) Certain entities that
are exempt from hotel tax may be issued identification numbers for
administrative purpose only. The comptroller may issue a tax number to an
entity that is not exempt from Hotel Tax, and a tax number does not guarantee
that an organization is exempt from Hotel Tax. An organization is not required
to provide an identification number on the Hotel Tax Exemption
Certificate.
(5) The exemption
certificate must be substantially in the form provided by the Comptroller of
Public Accounts and include:
(A) name and
address of the exempt organization;
(B) qualification for exemption under Tax
Code, §
156.102 or §
156.103 or other law;
and
(C) name and signature of the
occupant or, when the exempt organization issues the certificate, the name and
signature of an authorized representative.
(6) Copies of the certificate may be obtained
from the Comptroller of Public Accounts, P.O. Box 13528, Austin, Texas
78711-3528 or requested by calling 512-463-4600 or our toll-free number
1-800-252-1385. Taxpayers may download copies at
www.window.state.tx.us.
(d) Exclusions.
(1) Dormitories and other housing facilities
owned or leased and operated by institutions of higher education as defined in
subsection (a)(2) of this section and used to provide sleeping accommodations
for persons engaged in educational programs or activities at the institutions
are excluded from the definition of a hotel in Tax Code, §
156.001, and their rentals
are not subject to tax. Hotels owned or leased and operated by institutions of
higher education, however, are not excluded and their rentals are subject to
tax.
(2) Private clubs as defined
in subsection (a)(5) of this section do not collect tax on rentals of rooms to
members. Tax is due, however, on the rental of rooms to nonmembers. An
organization is not a private club and must collect hotel occupancy tax on
rentals of rooms to members and nonmembers if the organization:
(A) does not provide members entertainment,
recreation, sport, dining, social facilities, or other significant club amenity
in addition to lodging;
(B) does
not assess membership dues, initiation fees and other charges, assessments, and
fees for special privileges or status not available to the general public;
and
(C) the rental of a room is not
insignificant to the purpose or purposes of the organization.
Notes
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