Sales Tax
MIT is tax-exempt in many states, so remember to declare your tax-exempt status when making an MIT purchase. If you have your Procurement Card, you can show MIT’s tax-exempt number (printed on the card) to the supplier. For other purchases, you may need to present MIT’s tax-exempt form.
Massachusetts Sales Tax Exemption
MIT is exempt from paying state sales tax on the goods and services it purchases in Massachusetts.
MIT’s sales tax-exempt status is certified by Forms ST-2, ST-5, and ST-5C.
- When purchasing goods for MIT, a supplier will typically request that you provide both Forms ST-2 Certificate of Exemption and ST-5 Sales Tax Exempt Purchaser Certificate.
- Sub-contractors purchasing goods and services on behalf of MIT may need to provide Form ST-2 and Form ST-5C Contractor’s Sales Tax Exempt Purchase Certificate.
Out-of-State Sales Tax Exemption
If you are purchasing goods or services from a supplier in another state, check MIT's exemption status by state for relevant exemption certificates or numbers.
International Purchases
If your DLCI purchases from a company outside the U.S., the transaction may be subject to Goods and Services Tax (GST) or Value Added Tax (VAT). GST and VAT are non-U.S. taxes imposed on sales of goods and services and paid by consumers. Your DLCI is responsible for any GST or VAT costs, as MIT is not exempt from these taxes.
Record Retention
When your transaction is complete, you will need to keep documentation about the transaction.
- Receipts or other proof of payment for reimbursement requests, regardless of dollar amount
- Receipts or other proof of payment for ProCard. Exception: For transactions $75 and under, submit only backup for business meeting meals. (Alcohol is not allowed on the ProCard.)
- Invoices for purchase orders or requests for payment
- Record of receipt for goods (e.g., electronic receipt in B2P)
These records are used in support of internal approval processes, internal audits, and external audits
- to verify and approve transactions
- to show that an expense was legitimate and allowable
- to provide evidence that a transaction occurred
Ultimately, these records help ensure that MIT’s money is being used responsibly and effectively.
VPF advises DLCIs that electronic financial records stored on VPF central platforms do not require additional paper backup. Once complete and legible records are uploaded and approved in Concur, B2P, eRFP, Procurement Card Inbox, or journal vouchers, they are maintained by VPF and do not need to be stored and retained by your DLCI.
If you did not upload your receipt to a VPF system, your DLCI needs to store and retain records as follows:
| Record Type | How to Store |
|---|---|
| Related to multi-year sponsored award | Retain the record for three years after the close of the award |
| Paper | File locally and retain paper records for Current FY + 4 FYs |
| Electronic | Save to a shared department drive and retain records for Current FY + 4 FYs |
Having a thorough understanding of MIT’s policy will help you follow the policy as well as associated best practices.
See Buying and Paying Policies, Section 8.00 for MIT's Financial Record Retention Policy. Highlights include:
- You’re encouraged to keep records in electronic rather than paper form
- If the original record was electronic (e.g., an electronic invoice or receipt), keep it electronic; there’s no need to print out and retain it in paper form.
- Once you upload a complete and legible financial record to a VPF-managed application (Concur, B2P, eRFP, Procurement Card Inbox, or Journal Vouchers), VPF is responsible for retaining it.
The table below provides a visual guide of the policy (also available for download in PDF format).
| Financial Records Uploaded to VPF's Financial Systems |
Financial Records Retained Locally in Electronic Format
|
Financial Records Retained in Paper Form |
|---|---|---|
|
|
|
If you need some reminders of the policy and key best practices, take a look at the Financial Record Retention quickcards and FAQs:
- FAQs: Financial Record Retention
- Quickcard: How Long to Retain Financial Records
- Quickcard: Electronic Imaging
- Quickcard: ProCard and Travel Card Receipts
- Quickcard: ProCard Inbox Attachment
- Quickcard: Packing Slips for B2P POs
- Quickcard: Recording Receipt in B2P
You may find it helpful to keep these at your desk as quick references.
Payment and Delivery
Once goods and services are received and the invoice is fully approved, then payment will be issued based on payment terms to the supplier.
Understand Audits
Just like individual consumers, institutions like MIT are at risk for fraud and financial scams from both internal and external sources. VPF routinely monitors and audits purchases throughout the community to protect our resources and mitigate risk.
Receiving an occasional email requesting more information about your purchases is a normal part of the audit process. Learn more about preventing fraud when purchasing for MIT.
Fraud
Just like individual consumers, institutions like MIT are at risk for fraud and financial scams. VPF is dedicated to protecting the Institute's resources and encourages staff to learn how to recognize fraudulent activities.
Here are a few ways to be vigilant against fraud perpetrated by outside individuals and agencies.
- Carefully verify the claims of suppliers who reach out to you unsolicited as some may be scam artists and fake companies.
- Never give out sensitive personal or business account information to someone who has called or contacted you unsolicited.
- Carefully review all purchase orders and invoices. Scammers might attempt to present invoices for goods that were not received. If you suspect this has occurred, immediately notify your department leadership and work with the B2P Contact Center at b2p@mit.edu or 617-253-7000.
- If your Procurement Card or Travel Card is lost, stolen, or has transactions you do not recognize immediately contact Bank of America at 1-888-449-2273 and follow up with an email to VPF Travel and Card Services.
- Never accept any changes to supplier banking or address information via email or phone. Changes must be made by the supplier in PayModeX or through the Coupa Coupa Supplier Portal.
- Do not send sensitive information via email or phone, such as Social Security Numbers or W-9s. This information should ONLY be sent via PayMode or through Coupa Supplier Portal.
- Do not send Procurement Card numbers, Travel Card numbers, or security codes over email.
- Ensure communications from a trusted colleague or supplier are genuine. A common scam is to impersonate (or "spoof") a colleague to ask for gift card purchases or money transfers. If in doubt, verify with your colleague.
If you suspect you are the victim of a scam or other fraudulent practices, immediately notify the B2P Contact Center at b2p@mit.edu or 617-253-7000.
To ensure that we are good stewards of MIT’s financial resources and to mitigate risk, VPF routinely conducts audits — on specific orders and on orders randomly selected for review — on purchases made with MIT funds.
Occasionally, VPF may ask you for additional information about one or more of your purchases, such as itemized receipts or a more thorough explanation of your intent for the goods or services. This is a routine and normal part of the audit process. These requests should be addressed in a timely manner.
Here are some ways you can help mitigate risk to yourself and MIT:
- Ensure that you understand how to responsibly use MIT funds, as well as what costs are allowable and appropriate.
- If you are a Financial Primary Authorizer, you are responsible for maintaining the purchasing authorizations for your area in the MIT Roles Database.
- If you accidentally misuse your Procurement Card or Travel Card, please contact VPF Travel and Card Services right away to explain and resolve the situation.
- If you suspect someone in the MIT community is committing fraud, contact your department, lab, center, or institute (DLCI) Director of Administration and Finance (DAF).
Policy
VPF Buying and Paying 3.00 Purchasing Standards
When making a purchase, first consider if the costs are allowable, allocable, reasonable, and appropriate.