Here are some tips on getting exemption certificates:1. Follow the rules for the state where the delivery occurred, not where you're shipping from or where you're billing.
2. Try to get the actual certificate published by that state. While many states accept the multi jurisdictional form, they prefer their own. It's always a good idea to provide the auditor with the paperwork they're expecting. It also helps you make sure you're getting all the information they really want.
3. Make sure everything is filled out and signed.
4. Watch the numbers used. The federal employer identification number is NOT the number in the vast majority of the states. But it is the most commonly (and mistakenly) provided number.
5. Watch expiration dates. It seems like more and more states expire their certificates after a certain number of years. One way of addressing this is by refreshing one third of your collection per year.
6. Accept the certificates in good faith. This means there's nothing obvious, or something you should have known, that would tell you the sale really is taxable.
7. Even if you don't have nexus in the state you're shipping to, it's not a bad idea to still get certificates. Maybe you do have nexus and you didn't realize it. But mostly, it makes it easier from a policy perspective to collect certificates. Your staff just gets the certificate, regardless of the state.
Sales Tax Guy
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