When it comes to sales tax, there are a lot of things to take into consideration. For example, did you know that depending on your state, you may be required to pay sales tax on items that you resell?
This is where the Resale Sales Tax Exemption Certificate comes in handy. If you’re a business owner who sells products or services to other businesses, then you’ll want to make sure you have one of these certificates.
Here’s how it works: if a reseller certificate is submitted by the business, supplier, or the provider of the service or goods, and is authorized not to charge any sales tax–the liability for sales tax then lies with the re-seller based on the value of the final sale.
There are two ways of sharing a reseller’s certificate: by submitting an existing certificate to the business or creating a new certificate on third-party platforms such as Avalara or Tax Exempt. It’s important that whichever way you choose, both parties involved validate and approve the certificate before any transactions take place.
So, what happens if your state has nexus (a connection) with another state? In this case, even though your business is located in state A, you may be required to charge sales tax on items that are sold in state B. Confusing, we know.
The good news is that there’s a wealth of information available online (or from your local taxing authority) about the specific requirements for your state. Make sure to do your research before you start selling products or services across state lines!
o Indiana – https://intime.dor.in.gov/eServices/_/
Sales tax rate – 7.000%
Information required to register for a sales tax permit in the state of Indiana
1) Your estimated monthly taxable sales, if left blank you will be a monthly filer.
2) If you are a seasonal business.
3) If you provide lodging for less than 30 days.
4) If you will sell food and beverage.
5) If you will sell alcoholic beverages and your ABC Permit number with expiration date.
6) If gasoline will be sold through a metered pump.
7) If cars or trucks less than 11,000 lbs. will be rented from this location for less 30 days.
8) If income is derived from the sale of tobacco products.
9) If yes, from vending machines only.
10) If you report sales tax on a consolidated basis is this location included.
11) If you want your sales tax returns sent to a different address.
The purchaser does not need to circle one of the bullet points on the form in order for it to be valid- simply filling out and signing the form is enough. Keep in mind though that the address on the certificate does not need to match up with your company’s location address; it just needs to have your proper business name listed and be current.
A selling dealer can accept an Annual Resale Certificate that has only a single owner’s name on it and not a d/b/a; this type of certificate would be considered valid for resales in any type of transaction (i.e., store, e-commerce). The selling dealer can also continue to sell tax exempt products to this customer (for example, on charge account or cash-on delivery basis).
This certificate, also known as a tax exempt certificate, must be obtained by any business that plans to purchase products with the intention of reselling. Example: If your business is A and you’re located in Florida, you will need a reseller certificate to be able to sell goods in Florida. Normally reseller’s certificate is valid within the state however there is no clear-cut answer, as a few friendly states do accept certificates from other states, to do business in their own state.
The owners of validated the certificate lie with the supplier and all necessary steps must be undertaken to ensure that the certificate is valid
Indiana is a U.S. state in the Midwestern United States. It is the 38th-largest by area and the 17th-most populous of the 50 United States. Its capital and largest city is Indianapolis. Indiana was admitted to the United States as the 19th state on December 11, 1816. It is bordered by Lake Michigan to the northwest, Michigan to the north, Ohio to the east, the Ohio River and Kentucky to the south and southeast, and the Wabash River and Illinois to the west.
Various indigenous peoples inhabited Indiana for thousands of years, some of whom the U.S. government expelled between 1800 and 1836. Indiana received its name because the state was largely possessed by native tribes even after it was granted statehood. Since then, settlement patterns in Indiana have reflected regional cultural segmentation present in the Eastern United States; the state’s northernmost tier was settled primarily by people from New England and New York, Central Indiana by migrants from the Mid-Atlantic states and adjacent Ohio, and Southern Indiana by settlers from the Upland South, particularly Kentucky and Tennessee.
Indiana has a diverse economy with a gross state product of $377.1 billion in 2019. It has several metropolitan areas with populations greater than 100,000 and a number of smaller cities and towns. Indiana is home to professional sports teams, including the NFL’s Indianapolis Colts and the NBA’s Indiana Pacers, and hosts several notable competitive events, including the Indianapolis 500.Source