Resale certificates for Amazon wholesale: what they are, how to get one, and how to send it

Most new wholesale sellers meet the resale certificate on the first distributor application they open. There is a box for it, the rep often won't release a price list until it's filled in, and nobody explains what it is. This page does. It's part of the setup stage on the wholesale roadmap, right next to the step-by-step start guide.

Sales tax is set state by state, so the rules below come from the states' own pages, the Multistate Tax Commission, the Streamlined Sales Tax board and Amazon's US help pages. We link each one, and they are the final word if anything here disagrees with them.

Why distributors ask for one

A distributor that sells to you without charging sales tax has to be able to prove, later, that the sale really was for resale. The resale certificate is that proof.

The instructions on the Multistate Tax Commission's uniform certificate spell out the distributor's side. A seller has to keep a properly completed certificate on file for every customer who buys without paying sales tax, and if it doesn't have one, it is expected to collect the tax for the state the goods were delivered to. California's note on that same form says it from the other direction: on a sale for resale, the seller owes the tax unless it takes a timely, valid resale certificate in good faith.

So when a rep asks for your certificate, they aren't being difficult. Without it, every sale to you is a sales tax bill waiting to land on them in an audit. That's why many distributors won't quote prices or open an account until the certificate is on file.

It's also a filter. A certificate with a state registration number on it tells the distributor you are a real business that resells, which is exactly who they want to sell to. Without one, you look like a retail customer, and retail customers pay sales tax.

Stef covers this in the Checklist lesson of Apex University, which is free. From Stef's lesson, at 3:07:

"Creating a resale certificate is a mandatory step for most suppliers. This is the certificate that allows you not to pay sales tax on the products that you buy."

That's his experience opening accounts. It matches what Amazon tells new wholesale sellers, too: its own guide to finding wholesalers says you may need a reseller license or permits to buy from a wholesaler, and to have your business license and tax ID ready when you contact suppliers.

What it costs you to skip it. Here's one example, with a made-up rate just for the math. If your opening order is $2,000 and the ship-to state's sales tax is 7%, a distributor without your certificate adds $140 to the invoice. That is $140 of margin gone before a single unit sells, and Amazon will still collect sales tax from your buyers when those units do sell. On thin wholesale margins, that adds up fast. The cost to start guide has the rest of the startup budget.

Resale certificate, seller's permit and sales tax permit: the difference

These three terms get mixed up constantly, and the mix-up is why people get stuck. Two of them are the same thing under different state names. The resale certificate is a separate document that depends on it.

A few more names you'll see: "wholesale license", "reseller's license" and "resale number" are everyday terms for the same pair of documents. When a distributor's form asks for any of them, it wants your state registration number and, usually, a signed certificate.

One thing the certificate is not: a general tax exemption. The MTC's instructions say that if you buy without tax for any reason other than resale, you can't use its resale form. Charities and schools have their own exemption certificates. As a reseller, yours covers inventory you will sell, and nothing else.

How to get one

The order matters. You can't fill in a resale certificate until you have a state registration number to put on it, and you can't register cleanly until the business details are settled.

1. Settle the business name and get an EIN

   Decide the exact legal name you'll use everywhere: the state registration, the distributor application, your bank and your Amazon seller account. The IRS issues EINs online at no cost. The start guide walks through the rest of the business setup.

2. Register for sales tax in your home state

   Go to your state revenue department's site and register to collect sales tax. Each state section below links its page. Some states charge nothing to register and some charge a fee or ask certain businesses for a security deposit, so check yours. When you're done, you'll have a registration number (and, in Florida, a resale certificate the state issues to you).

3. Choose the certificate form

   Use your state's own resale certificate, or one of the two multistate forms below if the supplier and the ship-to state accept it. When in doubt, ask the distributor which form it wants. Many have a preference, and some send their own.

4. Fill it in for each supplier and keep a copy

   A certificate names the supplier it's issued to, so each distributor gets its own copy. Save a signed PDF with the application, and note any renewal date.

The multistate certificate from the Multistate Tax Commission

The Multistate Tax Commission (MTC) publishes the Uniform Sales and Use Tax Resale Certificate, Multijurisdiction. More than 30 states are listed on the form as accepting it, many with a note of conditions. You write the supplier's name at the top, then the registration number for each state you're registered in beside that state.

Two cautions from the MTC itself. It cannot guarantee that any state will accept the form, and states can change their policies without telling it. And the supplier decides whether to accept it. The MTC adds that a supplier that doesn't take care could be held liable for the tax in some states, which is why some are cautious. Download the form from the MTC's own page each time, since the MTC says not to use any other version.

Of the eight states in this guide, New York is the one that is not on the MTC's list. Florida, Georgia, Texas, Pennsylvania, California, New Jersey and Illinois are on it, most with conditions you'll find in their sections.

The Streamlined Sales Tax certificate

The Streamlined Sales Tax Governing Board publishes a single certificate of exemption, and its site says the certificate is accepted by all 24 of its member states (it lists 23 full members plus Tennessee as an associate member). Georgia and New Jersey are members. Florida, Texas, Pennsylvania, California, New York and Illinois are not.

The board's instructions are practical: give the completed certificate to your supplier and keep a copy, and don't send it to the board or to the states. If you aren't registered in the state you're claiming in, the board says you can give a sales tax ID number issued by any state.

My prep center is in another state: which certificate does the distributor need?

This is the question that trips up the most sellers, because many wholesale sellers live in one state and ship inventory to a prep center in another.

Start from the MTC rule above: when a supplier has no valid certificate, it collects tax for the state the goods are delivered to. When a distributor ships your order to your prep center, that ship-to state's rules usually decide the sale. Your home-state certificate may or may not satisfy it.

What the state pages say about buyers from out of state varies a lot:

• New York doesn't accept other states' certificates at all, though an out-of-state buyer can use New York's own form in some cases, such as goods delivered to its unaffiliated fulfillment services provider there (details).
• Georgia's note on the MTC form accepts a home-state number when goods are drop shipped to your customer in Georgia. A prep center isn't your customer, so don't assume that note covers it. Georgia's out-of-state form asks you to certify the goods will leave Georgia right after purchase (details).
• Florida's route for dealers not registered there asks you to certify you'll take the goods out of Florida, which inventory parked at a prep center there may not do (details).
• New Jersey's form for out-of-state sellers asks you to certify you have no independent contractors in New Jersey (details).
• Illinois accepts a home-state number only when the goods will be resold and delivered outside Illinois (details).
• California accepts a note in place of a California permit number, but treats inventory stored in a California fulfillment center as doing business there (details).

A prep center in another state is a normal, sensible setup. Choose it for the quality of its work and how well it fits your shipments. Our prep center guide covers how to choose one. Don't choose it for its state's tax rules. Once the distributor has a certificate it can accept for that state, you don't pay sales tax on the inventory either way.

Here's what to do in practice:

1. Tell the distributor the ship-to address on the application, not after the first order. Ask which certificate it needs for that state.
2. Offer your home-state certificate first, and the MTC or Streamlined form if the prep center's state is on its list.
3. If the distributor needs a number from the prep center's state, that's a registration question, not a paperwork one. Inventory sitting in a state can count as doing business there (California's fulfillment center guide says so, though California also excuses sellers whose sales all go through a marketplace), so ask a CPA who works with Amazon sellers before you register or decide you don't need to.

How to send it with a wholesale application

Most distributors ask for the certificate inside the application itself, either as an upload or as an attachment to an email. Our guide to opening a wholesale account walks through the whole application. Here's how to handle the resale certificate part.

Read what the application asks for. Some distributors want your state registration number in a box, some want a signed certificate, many want both. A few send their own form. If they do, fill in theirs rather than arguing for yours.

Fill it in for this supplier. The seller line is the distributor's legal name and address. The buyer is your business, exactly as registered. Describe your business plainly, for example "online retailer selling consumer products on Amazon", and describe what you'll buy in general terms, such as "grocery and household products for resale". Sign it as an owner or officer and date it.

Make every name match. The name on your certificate should match your state registration, the application, your bank and your Amazon seller account. That isn't fussiness. The invoices this distributor sends you become your proof of supply on Amazon, and Amazon's guidelines ask for the name on them to match your seller account.

Expect more questions from bigger distributors. In the same lesson, Stef says he sees more and more large distributors ask for a DUNS number on top of the resale certificate, to screen out businesses that aren't well established. That's his experience, not a rule, but it's worth having one ready if you're aiming at the big names in the Distributor Vault.

Check the first invoice. Once the account opens, make sure the distributor has marked it tax exempt for resale. If the first invoice still shows sales tax, ask whether your certificate is on file for the right ship-to state and ask for a corrected invoice. Some states let suppliers refuse a certificate even when it's correct. New York says so plainly, and points buyers who paid the tax to a refund claim with the state.

Keep it current. Florida's certificate expires every December 31. Illinois says certificates of resale should be updated at least every three years. When you move, change your business name or start shipping to a new prep center, send updated certificates.

Before you send your resale certificate

• Your state sales tax registration number, plus the number for any other state you're registered in
• The supplier's legal name and address in the seller line
• Your business name and address exactly as on your registration and your Amazon seller account
• A short description of your business and of what you'll buy for resale
• The form the ship-to state accepts (check the state sections below)
• Signed and dated by an owner or officer
• A PDF copy saved with the application, with any renewal date noted

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When the paperwork is ready, the next job is finding distributors worth applying to. Start with our guide to finding wholesale suppliers.

Buying on Amazon for resale: the Tax Exemption Program

Everything above is about buying from distributors. If you also buy inventory on Amazon.com to resell, which is common in online arbitrage, Amazon charges you sales tax at checkout like any shopper unless you enroll in the Amazon Tax Exemption Program.

Here's what Amazon's help page on the program says:

• The program supports tax-exempt purchases of items sold by Amazon, its affiliates and the independent sellers that take part, so items from sellers outside the program may not be covered.
• You enroll through a tax exemption wizard, state by state, with your organization's type and address and your exemption numbers or forms.
• Amazon does not accept sales tax permits, articles of incorporation, tax licenses, W-9s or certificates of registration for enrollment. It wants the exemption documents themselves.
• Its certificates required by state page links a matrix of the form it accepts for each state, with resale as its own row. Check your state's row first. For Florida, for example, the matrix names the Annual Resale Certificate and marks the multistate form as not accepted.
• The documents have to match the business name or address on your Amazon account, and be dated, signed and describe the items where that applies.
• Enrollment through the wizard should be active within 15 minutes. When a state's exemption can only be issued by its tax authority, you upload it, and Amazon's customer service reviews it and replies by email within 24 hours.

This is the program to use for buying on Amazon. You don't give Amazon a resale certificate for the things you sell there.

Does Amazon collect sales tax for you?

Mostly, for your Amazon orders, yes. Stef's lesson puts it simply: when you sell on Amazon, Amazon is already collecting sales tax for you, which is why the resale certificate matters on the buying side.

Amazon's Marketplace Tax Collection page explains how. Under marketplace facilitator laws, Amazon calculates, collects, remits and refunds sales tax on third-party sellers' orders going to the states where those laws are in effect. The page lists those states with their effective dates, and every state in this guide is on it.

What that page doesn't say is that you have nothing else to do. It describes Amazon's side of your Amazon orders. Two things can still be yours:

• Registration where you have a presence. Some states treat inventory stored in a warehouse there as doing business there, and each draws the line its own way. California's version, including its exception for sellers whose sales all go through a marketplace, is in its section below.
• Sales you make off Amazon, such as your own website or a local sale, where no marketplace collects the tax for you.

Which states you need to register in, and whether they expect returns from you, is a question for your state or a CPA. The resale certificate is the part you control on day one.

State-by-state links

Here are eight states, each with its own form and page. If your state isn't here, go to its department of revenue (the name varies by state) and look for sales tax registration and resale certificates. The notes on the MTC form are a good second stop.

We read each state's page when we wrote this guide and review it every year. States do change their forms, so the linked page always wins.

Florida

Florida works differently from most states: the state issues the certificate. Businesses that register with the Florida Department of Revenue to collect sales tax receive a Florida Annual Resale Certificate for Sales Tax. A new one is issued every year, each one expires on December 31, and next year's becomes available online each November.

You give the supplier a copy of your current certificate, and it no longer needs a signature. The supplier can verify it online, by phone or in the state's mobile app and get an authorization number for the sale, or keep a copy on file.

• MTC form: Florida is on the list, but its note says the supplier must still get a resale authorization number from the department using your Florida Annual Resale Certificate number. In practice, the MTC form works in Florida alongside a Florida registration, not instead of one.
• Buying from out of state: the department's page refers sales to nonresident dealers to Rule 12A-1.0015 of the Florida Administrative Code. Under part (3) of that rule, a dealer that isn't registered in Florida can buy without tax by signing a statement that it will transport the goods outside Florida for resale and for no other purpose. Inventory delivered to a Florida prep center and sent on to Amazon may not fit that statement, so ask the distributor or the department before you sign one.

Georgia

Georgia buyers give suppliers Form ST-5, the Sales Tax Certificate of Exemption, with their Georgia sales tax number on it. The department's page on sales for resale says the certificate protects the supplier when the buyer is in the business of selling goods, has a valid sales tax number listed on the certificate, and gives the supplier no reason to doubt the goods are for resale. Suppliers can check your number with the state's Sales Tax ID Verification Tool.

• MTC form: Georgia is on the list. Its note accepts an out-of-state buyer's home-state number when that buyer has no nexus with Georgia and the goods are drop shipped to the buyer's customer in Georgia.
• Streamlined form: Georgia is a member, so the Streamlined certificate is accepted.
• Buying from out of state: the department's forms page also lists Form ST-4, the certificate of exemption for out-of-state purchasers. On it, you certify that your only presence in Georgia is making purchases and that the goods will be removed from Georgia immediately after purchase. Inventory that waits at a Georgia prep center may not fit that, so ask the distributor or the department before you use it.

Texas

Texas uses Form 01-339, the Texas Sales and Use Tax Resale Certificate. It has a line for your 11-digit Texas permit number and a separate line for an out-of-state retailer's registration number. You give it to the supplier and do not send it to the Comptroller.

The Comptroller's resale FAQ makes a point worth knowing: your permit number, or a copy of your permit, is not a substitute for a resale certificate. Suppliers keep the certificates they accept for four years.

• MTC form: Texas is on the list. Its note says items bought for resale must be resold within the United States, its territories and possessions.
• Watch out: the Texas form warns that giving a resale certificate for items you know you are buying to use, rather than resell, is a criminal offense.

Pennsylvania

Pennsylvania's form is REV-1220, the Pennsylvania Exemption Certificate, which covers several kinds of exemption. For inventory, you check the reason that says the property will be resold and enter your eight-digit Pennsylvania sales tax license number. If you don't have a Pennsylvania license, the form asks you to explain why one isn't required, in its "Other" box. The supplier must have the certificate within 60 days of the sale and keeps it for at least four years. Don't send it to the Department of Revenue.

• MTC form: Pennsylvania is on the list, as a resale certificate only, not a general exemption certificate. Its note says the buyer should enter its eight-digit Pennsylvania license number, and a buyer without one must explain why it isn't licensed.

California

California's own form is CDTFA-230, the General Resale Certificate, but the state's guide for out-of-state retailers says a resale certificate may be in any form as long as it's timely and includes:

• the buyer's name and address,
• the buyer's seller's permit number, or a note saying why the buyer isn't required to hold one,
• a description of the property,
• a statement that it's being bought for resale,
• the date, and
• the buyer's signature, or that of someone authorized to sign.

"Timely" means before the supplier bills you, within its normal billing cycle, or before delivery. Publication 103 covers sales for resale in more depth.

• MTC form: California is on the list, as a resale certificate only, under its Regulation 1668. The note adds that a valid resale certificate stays in effect until the buyer revokes it.
• Inventory in California: the state's fulfillment center guide treats a seller storing inventory in a California fulfillment center as doing business in California, while its marketplace guide says you don't need to register if all of your retail sales go through a registered marketplace facilitator.

New York

New York uses Form ST-120, the Resale Certificate, and is strict about it. Its bulletin on exemption certificates says certificates from other states or countries are not valid for New York sales tax.

• Who can use ST-120: businesses registered in New York with a Certificate of Authority, and qualifying out-of-state buyers. Its drop shipment bulletin says an out-of-state buyer that isn't registered or required to register in New York, and is registered elsewhere, can use ST-120 for goods delivered to its customer or its unaffiliated fulfillment services provider in New York.
• Timing: give the supplier the completed certificate within 90 days of the sale, ideally at the time of the sale.
• Suppliers can say no: New York says a supplier can refuse your certificate even when it's correct and complete. Then it charges tax, and you claim the refund from the state.
• MTC form: New York is not on the list.

New Jersey

Businesses registered in New Jersey give suppliers Form ST-3, the Resale Certificate. New Jersey's exemption bulletin S&U-6 also describes Form ST-3NR, the Resale Certificate for Non-New Jersey Sellers, for out-of-state sellers that are not registered in New Jersey, are not required to be, and are registered in another state. It covers goods they pick up in New Jersey.

• Drop shipments: when an out-of-state retailer has a New Jersey supplier ship to its customer in New Jersey, the bulletin says the supplier may accept the retailer's home-state resale certificate, the MTC form, ST-3NR or the Streamlined certificate.
• No New Jersey number: ST-3 is for buyers registered in New Jersey. If you aren't, ST-3NR is the resale form built for you, and it carries your registration number from another state. On it, you certify that you have no place of business, employees or independent contractors in New Jersey, so check with the distributor or the Division before you use it with a prep center there.
• MTC form: New Jersey is on the list.
• Streamlined form: New Jersey is a member.

Illinois

Illinois buyers can use Form CRT-61, the Certificate of Resale, or make their own certificate that meets the state's requirements. The department's certificate of resale page says certificates should be updated at least every three years.

CRT-61 gives two choices. Either you are registered with the Illinois Department of Revenue as a retailer or reseller and give your account ID, which the supplier must check is valid and active, or you are an out-of-state buyer not required to register in Illinois who will resell and deliver the goods only to buyers outside Illinois. With FBA, Amazon can store and sell your units anywhere, Illinois included, so talk to your CPA before you check that second box.

• MTC form: Illinois is on the list, but its note says the number beside Illinois must be an Illinois registration or resale number. No other state's number is acceptable.

Resale certificate questions

Do I need a resale certificate to buy wholesale?

You can buy without one, but the distributor will charge you sales tax, and many distributors won't open a wholesale account at all until a certificate is on file. If you plan to buy inventory regularly, register for sales tax in your state and get the certificate sorted before you apply.

Does a resale certificate expire?

It depends on the state. Florida's Annual Resale Certificate expires every December 31. Illinois says certificates of resale should be updated at least every three years. California treats a valid certificate as effective until the buyer revokes it. Note the dates for each supplier you've sent one to.

Can I use the same resale certificate for every supplier?

You can use the same form, but each supplier gets its own copy with its name in the seller line. In many states, a blanket certificate covers your repeat purchases from that one supplier, so you don't need a new one for every order.

Do I need a resale certificate in every state?

No. You register for sales tax where the law requires you to, starting with your home state, and you give each supplier the certificate its ship-to state accepts. When your prep center is in another state, ask the distributor which certificate it needs, and ask a CPA whether you need to register there.

Can I use my resale certificate for things my business uses, like a label printer?

No. A resale certificate covers goods you will resell. Using it for things you keep and use can bring back taxes and penalties, and the Texas form, for one, warns it can be a criminal offense.

Does Amazon need my resale certificate?

Not for the products you sell. Amazon collects sales tax from your buyers in the states its Marketplace Tax Collection page lists. You only give Amazon exemption documents if you buy inventory on Amazon for resale, through the Amazon Tax Exemption Program.