Retail sales tax exemptions
Diplomatic exemption: Certain foreign officials are exempt from paying retail sales tax. To receive the exemption, the person must present an exemption card at the time of purchase. See Special Notice Foreign Diplomats Tax Exemption Program. This exemption also applies to lodging taxes.
Furnishing emergency lodging to homeless: Some cities, towns, counties, or private organizations have a program that furnishes emergency lodging for the homeless through a shelter voucher program. If your business participates, your charges for emergency lodging are exempt from retail sales tax, convention and trade center tax, and special hotel/motel tax.
Sales to the US government: Sales your business makes directly to the US government qualify for a retail sales tax exemption. This exemption also applies to lodging taxes. See US government sales section for documentation requirements.
Sales to federal corporations providing aid and relief (i.e. FEMA and Red Cross): Sales your business makes directly to the qualifying organization are exempt from retail sales and lodging taxes. To qualify for the exemption, payment must be received directly from the Red Cross. Purchases by employees or volunteers do not qualify. See Excise Tax Advisory 3156.2009 Disaster Relief Funds Provided by FEMA and the Red Cross.
Retail sales tax deductions
Sales tax collected by a facilitator: If you are a lodging business using an online marketplace or property manager to collect and remit sales tax on your behalf, the amount you claim under the retail sales tax classification is equal to the gross lodging sales the facilitator collected on your behalf. You can’t take a deduction the fees a facilitator keeps.
B&O tax credit
Small business B&O tax credit: If your business is below a certain B&O tax liability, you are entitled to a credit. This credit is automatically calculated when you file electronically.