What an interesting topic. Here are my two cents (not a professional, just what I've been told) and of course rules vary from state to state.
(1) It's my understanding that by accepting your PTO's tax id #, the vendor is accepting the risk. If HE is audited, and it turns out he failed to collect sales tax from a taxable customer, HE gets the slap. That why some vendors won't accept your "word" that your group is tax exempt, and need a copy of the letter. Or why some big vendors (ex: CompUsa) won't waive sales tax until your group is registered at their corporate office. I've even heard that some vendors won't waive tax unless the purchase is paid with a group check or credit card inthe group's name. Anyway, that said, if the vendor accepts an invalid tax id #, without satisfactory proof from the customer that s/he is authorized to use that tax id #, the vendor takes the risk. Of course, if someone is using a tax id # fraudulently, that's another matter. So, I'm not so sure you really need proof that your number was used properly on the receipt.
(2) I have always downplayed the idea that we shouldn't be paying sales tax (OF COURSE, THIS IS ALL PREDICATED ON THE ASSUMPTION THAT A PTO IS 501(C)(3) SO IT IS EXEMPT FROM STATE SALES TAX, USUALLY) and have never pushed our volunteers to ask for exemption when they make a purchase. But your posting piqued my curiosity, and I did a quick audit to see the impact of our own laissez-faire attitude about sales tax.
I was shocked! We track two different kinds of expenditures: reimbursement requests and check requests (bills that need to be paid, assembly performers, etc.). Last year, I processed about 80 of each type. On $64,000 worth of check requests, we paid only $54 in sales tax because most of the vendors are used to exempting schools/PTOs or the purchase is non-taxable in our state. What a far different story when a volunteer is asking for reimburesement from the PTO. We paid sales tax on virtually every taxable transaction, to the tune of approximately $450!! I guess I have a new crusade for this year.
Now, how to make this happen. Yes, I am going to educate our volunteers, and Yes, I am going to add a space for "sales tax paid" on my forms to highlight the issue. But,no, I don't think we'll penalize people for paying sales tax. At least not now. I think there are too many variables to hold our members accountable to eat sales tax. On the other hand, if there's a big purchase looming, I am going to try hard to make sure the volunteer knows the procedure for tax exemption.
(3) In our state (MI), we make our tax exempt letter off the internet, so we don't have to worry about losing the "official" copy or getting it back from someone. But...they don't need to know that. Can you make a big deal about "loaning" the volunteer your letter. Put it in a specially printed envelope that indicates it must be returned to you by a certain date. Keep track like an old library system of the copies that have been "checked out". Yes, work for you to followup, but don't reimburse them without getting the letter back. If people are using the PTO's exemption for their own gain, they're shmucks who have no business doing business on behalf of the PTO.
Great topic. You've given me something to think about!
