Yesterday my client was asked for her Resale Tax Exemption Number or Certificate. In Oregon, we don’t collect sales tax, but we wanted to confirm that there still wasn’t anything she needed to do with the State of Oregon. Here was the answer she got from her tax professional, and this is good stuff so I wanted to share it with you:
“A resale certificate is a piece of paper (certificate) that you have from a state revenue department stating that you are a re-seller of goods/products. A manufacturer will request a certificate from you to exempt the manufacturer from collecting sales tax from you. It also obligates you to collect sales tax from the person/corporation that you sell to (the ultimate user of the product). This is only important if you have clients in states that have a sales tax (e. g. Washington, California, etc). If your client (the ultimate user of the product) is an Oregon entity, then you do not have to provide any re-sale certificate to the manufacturer. If you are going to be making sales in Washington and other states with sales taxes, but you do not establish a nexus in any of the states, you may need to go to the multi-state tax commission’s website to obtain a resellers exemption certificate.”
If you do make sales in Washington, you still may be tax exempt, depending on your volume. Do check with your own tax preparer about this resale tax exemption to be sure! If you need a recommendation, send me a message and I’ll be happy to refer you to a CPA who will give you the right answer for your own business.
