All of the employees of any non-profit pay taxes on their income, just like employees of for-profit companies. All non-profits who pay employees pay the employer share of Federal employment taxes (Social Security and Medicare) and state employer taxes such as unemployment and disability insurance. All non-profits pay some state and local taxes despite their preferred status, such as sales taxes on items purchased for their operation, or embedded in government fees for things like vehicles. All utility bills a non-profit pays include unavoidable taxes and fees.