What is a resale certificate?
A signed statement from a buyer to a seller that the goods are being bought to resell. The seller does not charge sales tax on that sale, and the buyer collects tax from their own customer later. Without it, sales tax would be charged at every step of the supply chain. See how US sales tax works.
Who can use one?
Businesses that buy goods to resell, usually holding a sales tax permit in the state. Many states require the buyer's permit number on the certificate. Some states accept certificates from out-of-state buyers registered elsewhere, and some only from buyers registered in that state, which matters for online sellers and dropshippers. See dropshipping taxes.
Arbitrage sellers buying from retailers are a common case. See retail arbitrage taxes.
Which forms are used?
- State forms. Each state has its own resale or exemption certificate, and some require it.
- The Multistate Tax Commission uniform certificate, accepted by many states, sometimes with conditions.
- The Streamlined Sales Tax exemption certificate, accepted by member states of the Streamlined Sales and Use Tax Agreement.
Check that the form you give is accepted by the state where the sale takes place.
What can and cannot be bought with it?
| Can be bought tax-free for resale | Cannot |
|---|---|
| Products you will resell as they are | Office supplies and equipment |
| Components that become part of a product you sell | Tools and machinery used in the business |
| Packaging that goes to the customer with the product, in many states | Items you take for personal use |
If you buy something tax-free for resale and then use it yourself, you generally owe use tax on it. See sales tax vs use tax.
What must suppliers check?
Get a complete certificate
Buyer's name, address, permit number where required, a description of the goods, and a signature.
Accept it in good faith
The goods should be the kind the buyer plausibly resells.
Keep it on file
For as long as the state requires, and at least as long as sales could be audited.
Renew when needed
Some states require renewal every few years. Others accept a blanket certificate until revoked.
A seller without a valid certificate on file can be held liable for the tax it did not collect.
Print on demand providers are a common case. See print on demand taxes.
What happens if a certificate is misused?
The buyer owes the tax that should have been paid, plus penalties and interest. Knowingly giving a false certificate can carry heavier penalties, including criminal charges in some states.
Buying stock for resale?
We register you for the permits you need, prepare resale certificates for your suppliers, and keep your sales tax records in order.
Questions people ask
What is a resale certificate?
A document a business gives its supplier to buy goods for resale without paying sales tax, because tax is collected on the final sale.
Do I need a sales tax permit to use a resale certificate?
Usually yes. Many states require the buyer's permit number on the certificate.
Can I use a resale certificate for business supplies?
No. It only covers goods bought to resell. Supplies and equipment used by the business are taxable.
Is a resale certificate valid in every state?
No. Check that the form is accepted in the state of sale. Multistate forms are accepted in many, but not all, states.
Sources
Every fee, date and rule on this page was taken from these official and primary sources.
- Multistate Tax Commission: Uniform Sales and Use Tax Resale Certificate
- Streamlined Sales Tax Governing Board: exemption certificate (Form F0003)
- California CDTFA: Tax Guide for the Marketplace Facilitator Act
- Texas Comptroller: Remote Sellers
Rules and fees change. If you are reading this long after September 30, 2026, confirm the figures with the source before you rely on them.
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This guide is general information. It is not tax or legal advice for your situation.