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Drop Shipping Tax Exemptions in Oklahoma

  • Jan 20, 2015 | Gail Cole

 Oklahoma, where drop shipping tax policy sometimes changes.

Every two years, the Oklahoma Tax Commission responds to a 10-question drop shipment questionnaire. Some years its answers are similar to those given in the prior survey, and some years its answers are different. Taxpayers who use drop-shipping in the course of business are advised to remain up-to-date on this variable state policy, as it affects tax obligations.

For example, in a 2012 letter ruling, the Tax Commission tells a taxpayer that responses to the 2012 survey “have substantially changed from those in 2010.” A 2014 letter ruling reveals that “our responses are substantially the same to those given in 2012.”

Highlights from the 2012 Third Party Drop Shipment Survey:

  • Oklahoma will accept a resale certificate from the state of a Buyer Corporation not registered in- and having no nexus in- Oklahoma. “The Seller Corporation should obtain an exemption certificate listing the Buyer Corporation's resale number issued by its home state along with written confirmation that it is in the business of reselling the items being purchased, and that the items being purchased are for resale. The certificate should be signed by a person authorized to bind the Buyer Corporation. The certification may be made in the manner set forth in paragraph ( 1) of Oklahoma Administrative Code (OAC) 710:65 -13 -200.”
  • “Direct pay certificates cannot be accepted to exempt purchases for resale. The resale certificate is the proper document.” See OAC 710:65 -9 -10 and 710: 65 -13 -200.

Check out these 3 tips for documenting drop shipping tax exemptions for additional information about drop shipping. Then consider implementing an automated solution to sales tax. Learn more.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.