Quick Guide: Sales Tax Certificate (aka Seller’s Permit / Resale Certificate)

What it is (in plain English)

• A Sales Tax Certificate (often called a Seller’s Permit, Sales Tax Permit, or Resale Certificate) lets you:
  • Buy inventory tax-free from wholesalers because you’ll charge sales tax when you resell it.
  • Collect and remit sales tax from customers where you’re required to do so.

Names vary by state, but the job is the same: authorize you to collect sales tax and buy inventory for resale without paying sales tax at purchase.

Who needs it

• You sell physical products (online or in-person) to customers in a state.
• You buy inventory from wholesalers and need to provide a resale certificate.
• You have nexus (a sufficient presence) in a state — physical location, employees, warehouses, or you meet economic thresholds (sales/transaction count). Thresholds vary by state.
  

Service-only businesses usually don’t need one unless your state taxes your specific service or you also sell goods.

What it’s called in different states

• Seller’s Permit, Sales Tax Permit, Sales & Use Tax License, Reseller Permit/Certificate. Don’t stress the label — check your state tax/revenue site.

How to get it (step-by-step)

1. Confirm the correct state website
   • It should end in .gov and belong to your state’s Department of Revenue/Taxation.
   • If a site charges a fee to “file for you,” skip it. For most states, the permit itself is free (NY & CA are free). Some states may charge small admin fees, but you never need a third-party middleman.
2. Gather your info
   • Legal name, business name (DBA)
   • EIN (or SSN for sole prop), business address, owner info
   • Start date, NAICS code (industry), expected monthly sales
   • If you already registered your LLC/Corp, have that doc handy
3. Apply online (10–20 minutes in most states)
   • Complete the application on your state .gov site
   • You’ll set up a tax account for filing returns
4. Get your number/certificate
   • Many states issue a permit instantly or via email within a few days
   • Print your resale certificate (or use the state’s form) for vendors
5. Set up compliance
   • Add filing reminders (monthly/quarterly/annual as assigned)
   • Collect sales tax where you have nexus; file and remit on time

Official state examples (use these as models)

• New York (free): Apply for your Certificate of Authority
• California (free): Apply for a Seller’s Permit via CDTFA

Tip: For another state, search: [Your State] seller’s permit site:.gov or [Your State] sales tax permit site:.gov.

How to use it (after you’re approved)

• Buying inventory: Give suppliers your resale certificate (state form or the multi-state Uniform Sales & Use Tax Resale Certificate if accepted). Only use it for goods you resell — not for store fixtures, equipment, or personal purchases.
• Selling to customers:
  • Charge sales tax on taxable sales to customers in states where you have nexus.
  • File returns and remit tax by the due date (even if $0 in a period).

Common mistakes to avoid

• ❌ Using a resale certificate to avoid tax on non-resale purchases (illegal).
• ❌ Forgetting to file $0 returns — penalties can apply even with no sales.
• ❌ Applying on a non-.gov site that charges junk fees.
• ❌ Ignoring economic nexus: big online sales into a state can create a filing obligation even if you don’t live there.

Quick FAQ

Is it really free?

• In NY & CA, yes. Many states charge $0. If you see a fee, make sure you’re on a .gov site and not a third-party service.

Do I need one for online sales only?

• If you have nexus in a state (physical or economic), you typically need a permit there and must collect tax from customers in that state.

What if I sell in multiple states?

• You may need multiple permits — one per state where you have nexus. Start with your home state, then expand as your sales grow.

Can I backdate?

• Some states allow you to indicate the start date; apply before you begin taxable sales when possible.

Action Steps:

• Check your state’s .gov site and apply today
• Print your resale certificate for suppliers
• Set calendar reminders for sales tax filing dates
• Add a “tax” line item to your POS/checkout in states where you have nexus

Reminder: This is educational, not legal/tax advice. Always confirm details with your state’s tax authority or a qualified professional.