The Facts About Florida Resale Certificates
- Jan 13, 2017 | Suzanne Kearns
If you buy and sell tangible goods in Florida, you’ll need an Annual Resale Certificate from the Florida Department of Revenue (DOR), which allows you to purchase goods tax-free if they are intended for resale.
The state makes the process easy: As soon as you register to collect sales tax on behalf of Florida, you will be issued a Florida Annual Resale Certificate for Sales Tax. The certificates expire on December 31 of every year, except when a business registers as a seller in mid-October or later. Those certificates are good until December 31 of the following year. Every year, the state issues new certificates to all eligible sellers.
Using a Florida Resale Certificate as a Buyer
If you want to purchase goods to resell, all you need to do is present the seller with a paper or electronic copy of your current resale certificate. The seller will be required to keep a record of it for three years.
Using a Florida Resale Certificate as a Seller
If a customer wants to purchase products from you using a resale certificate, you have three options. First, you can accept an electronic or paper copy of it as discussed above. But you can also accept the certificate in other ways.
- If you want to be certain the certificate is valid and not be required to keep a copy of it for three years, you can get a transaction authorization number for the sale. To do so, call 877-FL-RESALE (877-357-3725) and enter the customer’s resale certificate number when asked. You can also go online and enter the seller’s information. Finally, you can use the FL Tax mobile app, which is available for all phones and tablets, and enter the customer’s information that way. You are required to keep the authorization numbers you receive in order to document your tax-exempt sales. However you decide to verify the certificate, you will be issued an authorization number, and if the certificate isn’t valid, you will be informed. You can’t use the authorization number as a blanket approval, but will need to get a new one for each transaction with the seller.
- If you have repeat customers, you can get annual vendor authorization numbers for them so you don’t have to ask for a copy of their certificate or call for an authorization number for each transaction. To do this, go to the Certification Verification page and enter the required information. Then, 24 hours later, you’ll be able to retrieve a batch file for customer certificate verification. This process eliminates the need for you to maintain a copy of the customer’s annual resale certificate.
Finally, if you purchase an item that you intend to resell, but end up keeping it, you must pay use tax on it when you file your sales and use tax return. Florida has both civil and criminal penalties for the fraudulent use of a resale certificate.