Nonprofit sales and use tax exemption modified to provide that certain purchases of prepared food by nonprofit organizations are exempt.

This bill modifies Minnesota's nonprofit sales tax exemption to allow certain qualifying organizations to purchase prepared food without paying sales tax, provided they distribute it as part of their charitable, religious, or educational mission. Currently, prepared food purchases by nonprofits are taxable under the exemption rules, but this change specifically exempts food bought by groups already covered under the nonprofit sales tax exemption (such as food banks, shelters, or educational programs). The exemption applies only when the food is distributed during the organization's core mission activities, not for general use. It will take effect for purchases after June 30, 2026.