Sellers are required to collect sales tax on their goods or services purchased in a state where they have nexus or a "physical presence," such as an office, plant or sales representative. However, if you do not have nexus in a state where you have a customer, then it is incumbent on the customer to pay use tax. You do not need to collect a form from the customer.
As a seller, there are several steps you should take to ensure compliance with sales tax laws:
- Identify states where you have nexus.
- Be aware of each state’s requirements. See Resale Exemption Certificate Resource Table for a complete list of state information, links to certificates and phone numbers.
- Review and understand the forms each jurisdiction requires. (Buyers who purchase products for resale or belong to organizations exempt from sales taxes should obtain, complete and send appropriate forms to sellers. But, sellers need to ensure the forms are correct.).
- Include the information in your customer master file.
For additional information see Managing Resale and Exemption Certificates.