Definition of tax exempt in English English dictionary
a particular source of income is tax exempt if income from that source is not taxable
Refers to organizations that do not have to pay federal or state corporate taxes or state sales taxes Corporations and individuals who make donations to these organizations can deduct their contributions from their income tax
A term usually used to mean exempt from state or federal corporate income taxes, e g a tax-exempt nonprofit organization However, organizations that are exempt from state or federal corporate income taxes are not usually exempt from all taxes
Refers to organizations that do not have to pay taxes such as federal or state corporate tax or state sales tax Individuals who make donations to such organizations may be able to deduct these contributions from their income tax
The state of an investment that produces income not subject to federal and/or state income tax For example, tax-exempt bonds are sold by local governments to finance such public projects as sewers, school construction and parks