Northwestern University is a private, not-for-profit, nonsectarian, coeducational institution, created by Charter by the State of Illinois in 1851. The University is exempt from Sales Tax, Use Tax, Retailer's Occupation Tax, Service Occupation Tax (both state and local), and Service Use Tax in the State of Illinois.
Jump to information about:
- Use of University tax-exempt status in Illinois
- Requests for Northwestern’s Tax-Exemption Certificate
- Reimbursement for Taxes
- Use of University's tax-exempt status in other states
Use of University tax-exempt status in Illinois
Tax exemption is to be used exclusively to make purchases for use by Northwestern University and is not for personal use by individuals, faculty, staff, or students. Any purchase by a student organization must be University related and paid for through University funds. Northwestern’s tax-exempt status is very serious and the integrity of how it is utilized must be protected due to the potential for abuse. Misuse of the University’s tax privileges could affect our tax-exempt status.
The University’s tax exempt status is NOT to be used for personal purchases by individual faculty, staff, or students. Not only can mis-use of NU’s E-Number result in possible revocation of the tax exemption if an individual uses NU’s E-number for personal use (or for purchases that are not in furtherance of NU’s educational and research purpose), the State can impose personal liability for the taxes due as well as impose criminal penalties on the individual.
Exceptions to tax-exemption
- The University is not exempt from Food and Lodging Tax on hotel rooms and meals. Exceptions to this rule apply to catered meetings and events, which fall under Sales and Use Tax.
- The University is not exempt from other taxes associated with catered meetings and events, such as City Tax, A/V Equipment Tax, Entertainment Tax, etc.
Requests for Northwestern’s Tax-Exemption Certificate
Procurement and Payment Services keeps information related to Northwestern’s tax-exempt status in Illinois, as well as several other states on file. If a department/school needs proof of Northwestern’s tax-exempt status, please adhere to the following:
- An official Purchase Order should be issued to vendors for University purchases. It references the standard NU Purchase Order terms which includes tax-exempt information.
- An Illinois Tax Exempt One-Time Use Letter for use by Faculty and Staff and an Illinois Tax Exempt One-Time Use Letter for use by Student Groups is available for individual purchases that many vendors will accept, which includes appropriate approval information.
- When using the One-Time Use Letter, an official form of payment from the University should be used, such as the issuance of a formal Purchase Order or use of a Northwestern Corporate Card. If a non-Northwestern form of payment must be used (such as cash, personal check, or personal credit card), the transaction must be less than $400 and you must request a separate employee certification form from Procurement and Payment Services that will to be provided to the merchant along with the One-Time Use letter. To request a separate employee certification form, email email@example.com the following information: vendor name, vendor address, detail of what will be purchased, estimated amount, and explanation of why an official form of Northwestern payment cannot be used.
- Procurement and Payment Services can send the official Illinois Tax-Exempt Certificate (or the official certificate from other states where NU is tax-exempt) directly to vendors that do not accept either of the above. Procurement and Payment Services does not provide the official Illinois tax-exempt letter to departments/schools.
Reimbursement for taxes
Since the University is exempt from paying Sales and Use tax, these taxes are generally not reimbursable when an employee has extended personal funds for the purchase. A special exception may be requested from the employee’s dean or department head in cases where it can be clearly demonstrated that the purchase and payment of tax was unavoidable or an emergency. This should be rare.
Use of University's tax-exempt status in other states
As a non-profit education institution, the University may also realize Sales and Use tax exemptions in several other states. This would apply to events you are planning in another state, or if you need to purchase goods and/or services from a vendor located in another state.
Northwestern University has been granted tax-exempt status in the states listed below. If you need proof of our tax-exempt status, contact Procurement and Payment Services and we will provide the vendor with the necessary documentation.
|Hawaii*||New Hampshire*||West Virginia|
* Does not have State Sales Tax
** Self Certification