Sen. Mcinnis files bill in North Carolina Senate to expand sales tax exemptions and update property tax rules

A new bill filed by State Sen. Tom McInnis in the North Carolina Senate aims to expand sales tax and property tax exemptions for nonprofit organizations and charitable housing, according to the North Carolina State Senate.

The bill, filed as SB 860 on April 28 during the 2025 regular session, was formally listed with the short title: ‘Nonprofit Fundraising Sales Tax Exemption.’

The following is our breakdown, based on the actual bill text, and may include interpretation to clarify its provisions.

In essence, this bill expands North Carolina sales tax exemptions by allowing qualifying nonprofit entities that are not state owned or controlled to buy goods, digital property and certain services tax free up to an annual cap, replacing the current refund system and creating a new exemption certificate process with penalties for misuse. It exempts all diaper and incontinence underpad sales, exempts admission to nonprofit fundraising events from the entertainment tax, and applies corresponding changes to local sales taxes. The bill also updates property tax rules so real and personal property used for charitable housing, including certain leased property, can qualify for exemption. Most provisions take effect between July 1 and Oct. 1, 2026.

Of the three sponsors of this bill, Jim Burgin proposed the most bills (86) during the 2025 regular session.

Bills in North Carolina follow a multi-step process before becoming law. A lawmaker starts by filing a bill, which is assigned to a committee for review. The bill must be read three times in each chamber. If one chamber changes the bill after the other passes it, both must agree on the final version. Once both chambers approve the same bill, it goes to the governor, who has 10 days (or 30 if the legislature is not in session) to sign, veto, or let it become law without a signature.

You can read more about the bills and other measures here.

Mclnnis, a Republican, was elected to the North Carolina State Senate in 2023 to represent the state’s 21st Senate district, replacing previous state senator Ben Clark.