Magazine article The CPA Journal

Out-of-State Purchasers' Use of Resale Certificate Form ST-120

Magazine article The CPA Journal

Out-of-State Purchasers' Use of Resale Certificate Form ST-120

Article excerpt

On June 5, 1998, the New York State Tax Department issued TSBM-98(3)S, which changes the requirements for use of Sales Tax Resale Certificate Form ST-120 by qualified outof-state vendors not registered in New York State. Previously Form ST-120 could only be used by vendors registered in New York State. Form ST-128, Out-of-State Resale Permit, can continue to be used as a legal exemption document until its expiration date.

Due to this new change in procedures, the department has revised Form ST-120 (Print date 5/98). Registered vendors may continue to accept and issue previous versions of Form ST-120 until they have acquired the new form. Contractors may not use the revised Form ST-120 when purchasing materials and supplies.

The TSB-M states the following: A qualified out-of-state purchaser is one who

is not registered and is not required to be registered as a sales tax vendor with the New York State Tax Department; is registered with another state, the District of Columbia, a province of Canada, or other country, or has its only location in a state, province, or country that does not require registration; and is purchasing items that will either be shipped by the vendor to the purchaser's customer or unaffiliated fulfillment company located in New York State, or shipped to the purchaser in New York State, but is resold from a business located outside the state.

An out-of-state purchaser can use Form ST-120 to make tax-exempt purchases when

the vendor will drop-ship the item/s purchased for resale to the out,of-state purchaser's customer in New York State; the vendor will drop-ship the item/s purchased for resale to the out-of-state purchaser's unaffiliated fulfillment service company in New York State; or the out-of-state purchaser takes posses sion of the item/s in New York State from a business located outside New York State. …

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