eCommerce Blog / How to Get a Resellers Tax ID

How to get a Resale License (Sales Tax ID)


Hey, would you like to pay tax that you don't actually need to pay?

I'm guessing your answer is a big, fat "Nope." No one does, which is why if you're going to get into the retail business, you need a reseller's permit (also called a resale license, reseller's license, resale certificate or reseller's certificate, sales tax permit or sales tax ID).

If you're a US-based seller, you don't need to pay sales tax out of your own pocket for the products you're reselling to others. Your customers will pay it when they buy the product. You'll collect the money and send it to the state on a routine schedule.

A reseller's license is your flag saying "I sell to others. I can buy wholesale products without paying sales tax because I pass the tax onto my customers." 

How Do I Get a Sales Tax ID/Reseller's License?

Half the trouble with signing up for a sales tax license is finding where to go!


To get started, you need to find your state tax department. For example, someone based in New York would go to the New York State Department of Taxation and Finance (either online, by phone or in person) and fill in the appropriate form.

You'll find that when you've made your way to the right website, most of the information and forms you need are just waiting for you. 

That's why I've got this nifty map to help you find your way faster:

Click on your state to find the right sales tax information for you,
and register for your license.

 

 

 

 
Sales Tax Applies
 
No Sales Tax

 

 

Find this useful? Spread the love: Share it. :)

Once you get your sales tax ID, the state will start sending you monthly/quarterly statements. In some cases, states will use your federal EIN as your sales tax ID. In some cases, they'll issue you a separate number. 

Sales Tax: A Brief Overview

Sales tax is a tax levied on all sales of physical goods to consumers within most states. Some states also charge sales tax for certain kinds of services.

Not all states charge sales tax: if you live in Delaware, Oregon, New Hampshire, Montana or Alaska, then sales tax either does not apply or applies only in certain circumstances. For sellers in any other state: yes, you do need to worry about sales tax!

You can find your state's sales tax rate here. It is important that you do this, because taxes vary significantly among the different states. For instance, some have one rate that applies state-wide, while in others, the rate varies between counties and cities.

Determining what state(s) you need to pay tax comes down to where you operate. A base of operations is called a "nexus." If you are dropshipping from home, you'll only be responsible for that state's sale tax because you only have one nexus. If you have a storage warehouse in another state, you have a nexus there, too. If you opt to ship goods via Fulfilled by Amazon, you technically have a nexus in whatever state(s) your goods are warehoused in.  

Note: In some states you also need to collect sales tax on shipping and handling.

You can learn more about sales tax here

A Bit of Extra Information for You

There are a few other things to consider when looking into the taxes you'll be responsible for as a seller. 

  • Reseller's Permits and Buying Wholesale 

    If you are a US citizen purchasing wholesale goods from a supplier within the US, then you will probably need a resale certificate or license from the state in which your business is located.

    A resale certificate or license enables you to purchase goods wholesale without paying sales tax. It also allows you to collect sales tax from your customers, the end consumer.

    Without a resale certificate, you will have to pay sales tax on the goods you buy wholesale and then also charge sales tax. In this case you can add the sales tax you paid as a deduction on your return, but it is much less complicated to just present your reseller's license when you buy.

    Most wholesalers will ask to see a sales tax ID or reseller's license before they will sell you the goods. This is because they are legally obliged to check whether you are able to collect sales tax from the end user.

  • Use Tax

    Another thing you may come across is something called "use tax." This tax is in place to discourage people from shopping in states with lower taxes than their own.

    Use tax means that if you purchase goods in another state, you owe tax equal to the amount you would normally have paid in your own state. It will also apply to you if you buy goods intended for resale and then end up keeping them for your own use.

    The good news is, if you are based in one state but ship to customers in another, you're not obligated to collect sales tax or deal with use tax at all. Just as you're responsible for paying the use tax if you get your supplies from out of state, your consumers are responsible for the use tax when they buy from you. 

    Obviously you could potentially get away without paying use tax because it works on an honor basis. However, should you be audited, use tax is something auditors like to hone in on. As a result, many new businesses get caught in the cross-hairs. Therefore it is wise to make sure that you pay it and keep the appropriate records.

  • Collecting Sales Tax on eBay or Your Website

    The process for collecting sales tax will differ depending on where you're selling.

    If you're selling on eBay, for example, you can learn how to collect sales tax on eBay here. The process basically looks like this:

    1. Go to "My eBay."
    2. Click the "Preferences" link from the left-hand navigation bar.
    3. Click "Show" in the "Payments from Buyers" section.
    4. In the "Use Sales Tax Table" section click "Edit."
    5. The "Sales Tax Table" page appears.
    6. Find the state you want to start charging sales tax in and put in the correct sales tax amount in the "Sales Tax Rate" field. You can also opt to charge sales tax on shipping and handling, if it's required.

If you're selling on your own online store, or if you're planning to in the future, things can get a little tricky if you're not careful!

The best thing to do in this case is hire an accountant, or use tax software such as Avalara to keep track of the sales tax you need to collect and pay. 

If you create your own online shop with SaleHoo Stores, setting up your sales tax collection is automated and easy.

  • Records to Keep

    You need to keep your resale certificate(s) on file as part of your business records. You must be able to match your sales records with the certificates for audit purposes.

  • Reporting Sales Tax

    How often you need to complete Sales and Use Tax reports will depend on your monthly sales turnover and the state you are working from.

It's very important you are sure to collect the correct amount of sales tax, as you will be held liable for the difference if you come up short.

Note: Trading Assistants do not need to collect or remit sales tax.

Common Questions on Reseller Licenses Answered!

What is Reseller’s Permit/License?

A reseller's permit or license is the documentation you need to avoid paying tax on items that you’re going to resell to customers. The sales tax for an item only needs to be paid once, and it’s paid by the end customer, not you as the seller. A reseller's permit lets your suppliers know that you are licensed to sell the items on, and that they can sell them to you without collecting the sales tax from you. Many suppliers will require a reseller’s license before they will do business with you.

Note that your reseller’s license will only allow you to avoid paying tax on items you successfully resell. If you are buying items for your business that you won’t be reselling, or you don’t end up reselling the items you’ve bought, you will be responsible for the tax on those items. 

Is a seller’s permit/resale license and EIN/Tax ID the same?

These are not the same thing. A seller’s permit/resale license is the same as a state tax ID, as both are issued by the state for sales tax purposes. An EIN or federal tax ID number, however, is issued by the federal government, not the state. The EIN is used to hire employees and manage employee taxes, and it is also used to file business taxes, while state ID numbers are used to file sales taxes. Here is the difference between an EIN and a state tax ID according to the IRS (you can register for an EIN there too).

To break things down a little further, a seller’s permit and a resale license aren’t quite the same thing either. A seller’s permit, sometimes called a "sales tax" permit or license, allows you to collect sales tax from your customers, while a resale license allows you to buy items you’re going to resell without paying tax for those items yourself. Some states prefer one term or the other, and many states combine the documents into a single license or state tax ID. You’ll find the requirements for your state when you register with them. To find the registration for your state, click on your state in the map further up in the post. 

Who will need a reseller’s permit/license?

If you want to buy products to sell, and you don’t want to pay sales tax on those items, you will need a reseller’s permit/license. For example, if you want to buy wholesale products to sell on eBay or your online store, you’ll need a reseller’s permit/license to avoid paying tax on those items. Suppliers will often require you to present one before they’ll do business with you. 

There are some states that don’t have sales tax, including Alaska, Delaware, Montana, New Hampshire, and Oregon. If you live in these states, or conduct business out of them, you might not need a reseller’s permit or license for these states. How this is managed depends on the state; Oregon, for example, issues a resale certificate for presenting to suppliers, while New Hampshire doesn’t issue licenses at all. You can use the map further up in the post to find the information pages for these states to find out whether you need a license.

What is an EIN?

An Employer Identification Number (EIN), sometimes called a Federal Employer Identification Number (FEIN), is like a personal ID number for a business. Businesses use their EIN to pay employees, and to file business tax returns. Some banks require an EIN before they’ll let you set up a bank account for your business. 

If you are a sole proprietor, you may not need to get an EIN, as you may be able to use your Social Security number instead. However, you might consider getting an EIN anyway, as this stops you from having to provide your Social Security number to others, which ultimately protects you from identity theft. You can register for an EIN here

What are Sales Taxes?

Sales tax is pretty much exactly what it sounds like: a tax applied to the sales of goods and services. The sales tax for an item or service is meant to be paid only once, and it’s meant to be paid by the end customer. When you’re buying items to sell on, you’re not the end customer, which means it’s not up to you to pay the sales tax for that item. That’s where your reseller’s license comes in! The license tells suppliers you’re a seller, and that they don’t need to charge you sales tax.

Generally, if you’re selling goods, you will collect the sales tax for those items from your customers when they buy from you. You’ll then pass that sales tax on to the state government. 

What is a Resale Number?

A resale number is the number attached to your reseller’s permit or license. When you get a reseller’s permit or licence from your state government, it will have your resale number. You can then give this number to suppliers to buy goods for resale without paying the sales tax for those items.

What is a Resale Certificate?

A resale certificate is yet another name for a reseller’s license or permit. This means it has the same function: to allow you to buy items for resale without paying the sales tax for those items yourself. 

You’ll present your resale certificate to suppliers to show that you’re certified to buy their stock without paying tax, because you’ll be charging your customers the sales tax for those items.

How to get a wholesaler’s license?

A wholesale license is yet another name for a reseller’s licence. To get a wholesaler’s license, you’ll apply through the preferred application system of the state you live in or conduct business out of. Most states have an online application system to make it faster and easier for you to apply. 

To register for a wholesaler’s license in your state, use the map further up in this post. Simply click on your state to go through to the registration page or info for your state. If you’re not sure about your specific situation, you can try contacting your state’s tax department to ask.

 

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Comments (445)


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yalloak on 0:34 24 Jun
Hi Gina, I am based in Australia but wish to only list products on the US eBay platform for sale to US residents. What is the situation regarding Tax and/or any licencing requirements to become a reseller?
Melissa Johnson on 21:46 24 Jun
If you're outside the US, you don't need to worry about paying tax in the US unless you choose to incorporate there (doesn't sound like that's what you're interested in). Otherwise, all you have to worry about is meeting eBay's requirements and Australia's tax laws. Specific dropshipping companies might want to see proof of business, but that isn't true of all companies. I would check with an accountant about what you need tax-wise in Australia.

Good luck!
Hector Ariel Febles Benitez on 22:14 24 Jun
Hi Gina, Im from Dominican Republic, butt plan to sell good in the USA What do I need to do Tax wise??
Melissa Johnson on 17:50 8 Aug
Hi, Hector!

Unless you incorporate in a US state or establish a base of operations in the US, you aren't obligated to deal with taxes here, just your home country.

Hope that helps!
daniel popa on 11:15 20 Aug
not that i am an expert in taxation ....but this sounds wrong....if one sells a product on usa ebay to an usa citizen in the state of say california....then should not the seller charge tax and pass it to the gov of california since the transaction is within usa and the buyer is based in california???
Melissa Johnson on 17:01 22 Aug
eCommerce falls into a bit of a nebulous area just by virtue of being a global thing. It depends entirely on the seller's location.

If you have a base of operations in the US (a "nexus," technically), you're liable for taxes in the state where your nexus is located. But if you're based abroad and have no physical presence in the US (such as dropshipping from a foreign country), you're not. However, any goods you ship from a foreign country into the US might be subject to customs duties, which are the responsibility of the buyer. If they don't pay, the item is sent back.

http://blog.taxjar.com/international-sellers-deal-sales-tax-u-s/
Travis Brian Olson on 5:45 27 Aug
Hi Melissa quick question :).

What exactly are all the things I will need to register for If I want to drop ship on amazon and ebay?

I could not find a solid answer on this . I live in Marietta Georgia of the United States.

Do I need a re seller permit and a business license? or only a reseller permit? Is there a difference between a sellers permit and a resellers permit? Also do I need an LLC? what about DBA?

I'm so confused on this and not sure exactly what I need to register for to drop shipping online. Can you help clear this up?
Also do you have a site you recommend to register through the internet to get registered quickly without the hassle?
Melissa Johnson on 5:12 31 Aug
Hi, Travis!

First of all: I'm not an accountant or a lawyer. I can give you some information, but if you want to be 100% sure you're compliant with state law, I highly recommend talking to an accountant.

When you start your business, by default you are considered a sole proprietorship. If you choose to incorporate as an LLC, you get additional legal protection for you and your business, but you'll have to file your taxes differently and pay to register. You don't /have/ to become an LLC right away, but as you start making more money, it could be worthwhile.

Here's what I've learned: Sellers permits, resellers permits, etc., tend to go by many names and sometimes the terminology gets confusing because there's not a lot of consistency. Basically, you need to tell the state that you are a business and get a permit to collect sales tax. The technical name for this permit, in George, is the "Sales and Use Tax Certificate of Registration." Depending on where you're getting supply from, you may also want to get a certificate that you can show to other retailers/suppliers to show that you are exempt from playing sales tax on those purchases. Some suppliers require it.

To apply for your Sales and Use Tax certifiicate, here's a resource: https://dor.georgia.gov/registration

You may also need to register with your city or county for business license, per this: https://georgia.gov/popular-topic/applying-business-license I don't know how that applies to eCommerce businesses. It's a good question to ask an accountant. =)

A DBA is just "doing business as." I honestly don't know if you'll need one. Here is a bit more info though: https://www.legalzoom.com/articles/file-a-dba-in-georgia

I hope this helps!
Lynda on 5:05 11 May 2018
I am going through this right now, and I live in Washington. I had to spend a lot of yesterday on the phone with my state gov. and according to my laws here, in order to get a resale permit, because I live in the city limits I need to have a business license even for an eCommerce store. They told me, I need to determine if I am in a city or county limits and it doesn't matter what it is, I need a license. I would be considered a retailer under our law and if I wanted to make large purchases to sell myself or if a customer wanted lg orders, I would have to make sure I added wholesaler to my license.
I have been wondering why more people haven't addressed the possible need for a business license because in some areas you have to have that before you can even look at getting a resale permit and here, that is what costs the most.
Manish Patel on 11:31 18 Sep
I am in India and going to use drop ship facility of a company in New York State,

so as non citizen of USA how can i have resale certificate?
is it compulsory to have resale certificate?

please guide me
Thank you
Manish
Melissa Johnson on 20:08 19 Sep
Hi, Manish!

You shouldn't need a resale certificate unless you do something that would create a nexus -- incorporating, importing to the US, etc. If you are just dropshipping, that shouldn't be required.

However, I am not familiar at all with India's laws regarding eCommerce and taxes for businesses. Even if you're not responsible for collecting tax in the US, you are still responsible for making sure you're covered in your home country.

You'll also want to find out what documentation your supplier might require.

Hope this helps!
Rex on 15:11 30 Sep
Hi Melissa,

So from what I understand the point of a resale certificate is to not have to pay sales tax on items that you mean to resell. However, what happens if you buy something using your sales tax ID and don't pay sales tax, but then don't resell it? What happens if you don't sell anything the entire year?

Also, are there any fees that may result from getting a Resale certificate?

Thanks,
Rex
Alejandro Almaguer Cardenas on 22:42 10 Jan
if im in mexico, will i need a reseller licence?
Franklin Cerrato on 3:25 19 Jan
I don't live in the United States. How can I go about this?
It seems most of the wholesalers, at least the trustworthy ones, need this number to do business. Plus I'm new to this so I really didn't even think I needed a "business identification Number" so, is there a solution for international sellers?
(I don't even have my own online store)
Justin Golschneider on 15:33 1 Feb
Hi Franklin! If you don't live in the U.S., you'll want whatever sales tax ID your country uses. For example, if you live in the E.U., you'd want a VAT number.
Diva Mangal on 19:46 22 Feb
Hello Melissa, I just signed up, and I am located in Alberta Canada, if I wanted to do dropshipping, am I required a Tax ID here in Canada? I am a little bit confused, do you mind explaining? thanks
Devin Corbett on 16:58 16 May
Same Question.

Applications to work with drop-shippers require that I fill out the feild for re-seller certificate, as a Canadian citizen I don't have a reseller certificate. How do I get one, or what can I put it its place? Without something in that section I can't submit applications / be considered by companies / etc.
Justin Golschneider on 12:11 18 May
Hi Devin and Diva! I would register for GST/HST if it applies to your location: http://www.cra-arc.gc.ca/gsthst/

That ought to do the trick. You can also contact our support team to look into this further--maybe we could even get a new article written about it. :-)
onetalldwarf on 0:44 1 Aug
I live in Australia and want to deal with suppliers/dropshippers/wholesalers within the US to sell on Amazon and eBay etc.
I have applied to several US suppliers and some I've not had a reply...
it's most likely because I don't have the required licence?

What will I need to do from Australia (in my case) regarding a resellers certificate?
Please help.
Justin Golschneider on 18:04 1 Aug
Hello! It's more likely that they wanted to see an EIN if you don't have one yet. But, here's a helpful article on registering for sales tax when selling from another country: http://www.salestaxsupport.com/blogs/industry/us-sales-tax-for-foreign-sellers/international-sellers-and-u-s-sales-tax-registration/
Linda L. Hodge on 4:16 8 Aug
I reside in Southern California. Currently there is a crazy trend that has the women 30 years to 50 years of age running from store to store to find a specific pottery piece by a specific upcoming artist. I want to purchase these pieces in bulk and resell these charming pieces across the United States.
I don't have a resale license, certificate, or the other. I'm just getting started but need to get moving because time is money.
Any thoughts?
Thank you,

Linda
Justin Golschneider on 13:47 8 Aug
Hi Linda! Generally, the fastest option is to go to your local town hall and ask what you'll need. They should be able to set you up with everything necessary to purchase wholesale and sell from your house or locally operated business, including licenses and information on any state and local taxes that may apply.
Mark C. on 2:48 23 Aug
Hi, I live in the state of Georgia and I'm interested in becoming a wholesale distributor. My customer base would be overseas and the sales would be conducted over the phone and via email. The majority of them have freight forwarders that I'd send the products to or they'd pick up from me, and then in turn ship to my customer. What if any licenses would I need to apply for? Any help would be greatly appreciated.
Justin Golschneider on 14:07 23 Aug
Hi Mark! I would start with a Georgia sales tax permit: https://blog.taxjar.com/register-sales-tax-permit-georgia/

You will need this to prove to your suppliers that you are reselling the goods and not just trying to buy in bulk while dodging sales tax. You will also need it to charge sales tax to any consumers you sell directly to in Georgia, though you won't need to charge any licensed retailers.

I'd ask if you need anything else at your local town hall. Happy selling!
Nafis on 8:06 27 Aug
Hello
I live in Bangladesh. And I want to drop ship from China to USA. So do I need to pay any sale tax..? Please answer.. It will help me a lot.
Thank you
Justin Golschneider on 17:26 28 Aug
Hi Nafis! If neither you nor your suppliers have any offices or warehouses in the U.S., my understanding is that you would not need to charge or pay U.S. sales tax. You'd only have to deal with customs.
Arifah radhiah on 22:47 4 Sep
Hi, I am not a USA citizen and already got my EIN number. However my supplier ask for a copy of my resale certificate if I want to buy from them. What should I do as I only have the EIN number.
Justin Golschneider on 12:59 5 Sep
Hi Arifah! If you do not have any business locations or sales tax nexuses (like those created by using Amazon FBA) in the U.S. and otherwise do not have to pay sales tax, then I would explain the situation to them—sales tax should apply neither to your sales nor to their sales to you, so a certificate is not needed.

However, if you have to collect and remit sales tax in any state, then you should register for a reseller's certificate before moving forward with supplier negotiations.
Chau Nguyen on 23:26 10 Sep
Hi Gina,

I live in Montana and there's no sales tax here. I was told by the MT Department of Revenue that MT doesn't have a resale certificate. How do I purchase my supply at wholesale price without this certificate? I'm a jewelry designer and maker. Thanks for your help!
Justin Golschneider on 16:17 11 Sep
Hi Chau! If you plan on selling directly from your home and/or other Montana locations, then simply tell them that a reseller certificate is not applicable to you because there is no sales tax in Montana. However, if you're planning on selling through FBA or have locations in other states, then you will need sales tax IDs for all applicable states. In that case, you can sign up for those first so you have something to show.
Rosa Gonzales on 0:32 17 Sep
Hi, I am thinking of starting my own online business, I dont know how may licenses , permits, reseller permits or what ever else is needed. Can I get some help please? I just need to know I have all my ducks in order. Thanks Rosa G
Justin Golschneider on 20:37 19 Sep
Hi Rosa! If you get started without using Amazon FBA and only selling from your own home, you generally only need a sales tax ID / reseller certificate for your state, and possibly your city. Your town hall can provide all the necessary paperwork.
Elias on 10:00 22 Sep
Hi
what if i buy from a US supplier with no Tax then export to another country ?

Elias
Justin Golschneider on 14:37 22 Sep
Hi Elias! To the best of my knowledge, a resale certificate / sales tax ID only applies to domestic sales. It won't be applicable to you if you only sell to customers outside the U.S.
company registration on 11:09 29 Sep
good and service tax is very vast. And detailed information provided by you is very helpful for me.






Tahnesha on 7:41 2 Oct
I have an Australian ABN can I still apply to companies that require a sales ID, Im guessing yes but not sure.. thanks...?
Richelle Monfort on 3:46 4 Oct
Hello Tahnesha,

Yes, you can :) You can use your Australian ABN when asked for a sales tax ID as it is the equivalent of it. Hope this helps!
Tremayne Moody on 16:59 8 Oct
I'm mostly looking for clothing vendors so that I may purchase and resale.
Richelle Monfort on 10:47 24 Oct
Hello Tremayne,

Yes we do have suppliers of these. You can check out products/brands we have using this demo if you wish: https://www.salehoo.com/find-a-supplier (you need to join for full details obviously).

Once you join you can instantly access and contact them within our directory. You can join here when ready: https://www.salehoo.com/join-now It's $67 USD for one year which gives you unlimited use of SaleHoo.

Feel free to let me know if you have any further concerns, I am happy to help!

Have a great day :)
Steve on 15:11 11 Oct
I operate a business in Connecticut that sells strictly online. I have a Sales and Use Tax Permit that allows me to buy tax exempt goods for resale. So far I have only purchased goods from Connecticut for resale. What would I need to do in order to purchase good from New York for resale on my online store in Connecticut? Can I use the same Permit? Should they accept it or do I need to get something from NY State?
Richelle Monfort on 11:53 24 Oct
Hello Steve,

You might find this article helpful - https://www.tax.ny.gov/pdf/memos/sales/m88_12s.pdf All the best!
Richard on 17:21 13 Oct
I live in WA state, and I am considering starting an online-only dropshipping business, which by definition would have both clients and wholesaler/suppliers from around the country as well as around the world. I have thought of doing it through eBay, through Amazon, and through my own web-based store (i.e. Shopify) with ads on social media (i.e. Facebook, Instagram, etc). None of the "how to get started" sites I've come across so far have mentioned anything about taxes or business licenses. I just randomly stumbled across this site, so I have a couple of questions. 1: Is there a certain point where if you make less than that amount each month (or each year) you do not need to file taxes or have a business license? Or are they all breaking the law, or more specifically teaching others to do so? 2: Can you get away with incorporating the sales tax into the price and not mentioning sales tax at all? For example (I will simplify the math): I have an item I want to sell for $10, and tax would be 10% or $1. Can I just sell it at $11 without mentioning sales tax, and pay the sales tax out of my own income at the end, without any issues? 3: Can I do the same with Shipping & Handling? Basically, I sell the item as $12, say it is tax free and that shipping is free, and then pay the $1 or $2 fees later when I file? 4: Is it possible to get started with the dropshipping business, keeping detailed records, and then only after sales pick up THEN get the reseller's license and/or business license (this would still be before it's time to file taxes for the time during which I got started).
Richelle Monfort on 11:56 24 Oct
Hello Richard,

To ensure that you get the correct answers to your questions as they are very specific and involve computation, I strongly suggest you visit your local county clerk's office or consult an account to explain these to you in detail. Hope this helps a bit :)
loic leroi on 10:16 24 Oct
Hi,

I live in Australia and want to use US drop shippers to sale to US customers. I have a EIN, an amazon account. But I'm still trying to get my head around the sales tax and resellers certificate.. Im not sure how to proceed with those.
Richelle Monfort on 11:08 24 Oct
Hello loic,

Since you are based in Australia, this guide should help https://www.salehoo.com/education/business-setup/registering-a-business-in-australia Cheers :)
Anna Drozhinski on 7:45 14 Nov
Hi
My name is Anna & i live in Israel.
which documents would i need for my drop shipping business?

tnx
Anna

Rakesh Mistry on 14:36 15 Nov
Hi Mellisa,
I am US citizen based Texas. I have applied for my LLC based in texas and also planning to get my Tax ID soon. I am planning to launch my e-commerce dropshipping website home based. My question is.
1. My dropshiipers are located in china and they will send order direclty to usa via epacket delivery. Once customer placed an order on my website i will let my dropshipper know and they will send order to customer directly. what will be tax implication on this. should i charge my customer sales tax?
2. I also dont pay any taxes when i purchase something from dropshipper. as they dont require my tax id. or chinese supplier dont care whether u have tax id or not.
2. Do i need any other licences to conduct business?
3. are sales Tax ID and reseller permit same/?
4. What if I have no income.


Richelle Monfort on 6:39 17 Nov
Hello Rakesh,

The best for you to do is check with your county's Tax office so you can apply the correct tax charges to your customers. It's not always required to get started with most suppliers but there are quite a few benefits in obtaining one. I'd recommend you check out the post below to give you a full understanding:

https://www.salehoo.com/blog/why-suppliers-ask-for-documents
Richard Vale on 23:19 18 Nov
Hi guys,

I'm from Canada
I have an Oregon US address
I plan to sell in Amazon.com (US)
I need EIN and Reseller cert

What about Sales Tax implications based on my above background? I know Oregon doesn't collect Sales Tax. Do I need? Any info/advice are much appreciated. Thanks!
Richelle Monfort on 4:30 20 Nov
Hello Richard,

Although you will be selling in Oregon, it might be best if you check with your tax office in Canada to be sure since you are currently based there. All the best!
Youwillsurvive.org on 0:49 6 Dec
'If you're a US-based seller, you don't need to pay sales tax out of your own pocket for the products you're reselling to others. Your customers will pay it when they buy the product. You'll collect the money and send it to the state on a routine schedule.

A reseller's license is your flag saying "I sell to others. I can buy wholesale products without paying sales tax because I pass the tax onto my customers."

I couldn't get a tax attorney or several other people to have put it this plainly.

TELL ME WHAT IT IS, WHAT IT DOES AND DO I NEED IT. No ONE except this article said this!!!!

Thank you!
Richelle Monfort on 6:09 16 Jan
Hi there,

Having sales tax nexus in one or more states means that state requires you to register for a sales tax permit with the tax department for that state (generally called the State’s “Department of Revenue”). Once you receive your sales tax permit, you’ll need to collect sales taxes on from all of your customers in those states when taxable sales are made. You will also be required to remit and file these "collected taxes from your customers"

You can read more about online selling tax concerns here: https://www.taxjar.com/guides/intro-to-sales-tax

Hope this helps!
Aaron Warren on 2:36 6 Dec
Hello,
My name is Aaron Warren, i have been researching about starting an online drop shipping store on shopify, i live in canada but will be selling to usa. The one thing that i would like some help with would be taxes, as in i am a Canadian so im guessing i would pay my income tax two Canada. but do i need to pay sale tax to usa? and would i just need two apply for a ENI and a Business Number
Richelle Monfort on 6:02 16 Jan
Hello Aaron,

Since I'm not tax expert myself, I think you will find this article helpful in getting your questions answered - https://sellics.com/u-s-sales-tax-explained-for-both-u-s-and-non-u-s-sellers

All the best!
Kingsley Egeke on 16:50 15 Jan
l really appreciate your point on this resallers tax, what of those of us who are not US resident and we do sell on ebay, amazon and other how do we register or get tax ID?
Richelle Monfort on 6:05 16 Jan
Hello Kingsley,

If you live outside the U.S. and have no sales tax nexus in the U.S. – In this case you won’t have to worry about registering for a sales tax permit and collecting taxes. You might still make sales to customers in the U.S., but if you do not have sales tax nexus in any U.S. states then you do not have to collect U.S. sales tax.
You can read more about tax nexus here https://sellics.com/u-s-sales-tax-explained-for-both-u-s-and-non-u-s-sellers

Also, might be best if you refer your concerns to an account.

Hope this helps!

Ciggu on 13:45 17 Jan
Hi, I am based in Illinois and I sell ecig online. My understanding is that IL doesn't require license just to sell ecig but the usa wholesalers want me to present retailer license. What kind of license do I need since I guess there is no license requirement to sell ecig? And do I need to collect tax from customer? I sell only ecig.
Richelle Monfort on 8:15 18 Jan
Hello Ciggu,

You will have to check with your local country clerk if you need specific permits or documentations to sell ecigarettes.

All the best!
ibrahim awel on 16:51 29 Jan
hi i live in sweden and i want to get seller iD but i dont know how to get it in the united states.
Richelle Monfort on 7:09 31 Jan
Hello Ibrahim,

A Sales Tax ID is for resellers based in the US. You can provide the equivalent in your country which is your VAT ID. Hope this helps!
Wilfred Obi on 19:22 1 Feb
Thank you for this insight. I am setting up my online store with Shopify and would like to obtain a reseller certificate so i can deal with other suppliers within the US. However, i am currently married to a US citizen and we both live in the state of Montana. Can i obtain the certificate even as i am not yet a citizen of US?
Richelle Monfort on 6:39 7 Feb
Hi Wilfred,

Sorry but it might best if you consult your local county/city clerk or accountant about this matter. I'm sure they will be able to guide you accordingly.

Cheers!
Kathy on 18:54 11 Feb
Hello I currently reside in New Jersey I have a resell certificate. But I am planning to order from China do I need a resell certificate. Being that I’m working on starting my own toy line and purchase through China.
Richelle Monfort on 6:06 12 Feb
Hello Kathy,

This guide might be helpful https://www.salehoo.com/education/importing-shipping/all-about-importing-from-china in your plans to import from China.

Cheers!
Kathy on 18:56 11 Feb
I would like to know is it necessary to have to register a logo to start your own toy line? I want to order in China but currently I don’t have the funds to hire a lawyer to help me register a logo.
Eric on 4:23 13 Feb
Hi, I'm Eric from Singapore.
I have some tax questions, would appreciate if you can provide some advice.
My business revolves around buying from US wholesalers and selling them on Amazon.com

I have 2 options right now:

Option 1: Form an LLC in the US.

A lot of the US wholesalers require a reseller permit or a business license in order to do business, and I understand that I can get a business license if I were to form an LLC in say, Wyoming.

1) Will I be required to pay US income taxes on this LLC? If I have to pay US taxes, will I still be required to pay taxes in Singapore for my income from Amazon?

2) Do I have to pay sales tax? I engage prep distribution centers in Michigan and North Carolina to prep my products before shipping to Amazon.


Option 2: Use my existing Singapore-incorporated company
1) If I decide against setting up an LLC in the US, can I use my Singapore-incorporated company when dealing with US wholesalers? Will this affect my chances of opening up a wholesale account with them as I do not have a reseller permit? I can show them my business license from Singapore though.

2) Will I be required to pay US income taxes?

3) Will I be required to pay US sales taxes?

Thank you very much and I look forward to your reply! :)
Richelle Monfort on 6:59 14 Feb
Hi Eric,

As much as I want to help you, I'm afraid I have to strongly suggest that you seek professional advice from an accountant so that you will be given the correct answer to your queries.

All the best!
KATHY JOSEPH on 17:16 17 Feb
My LLC IS FOUNDED IN WYOMING BUT..... I LIVE IN FLORIDA. IT IS ALL INTERNET BASED. DO I NEED A SALES TAX ID FOR WYOMING AND FLORIDA OR JUST WYOMING?
Richelle Monfort on 4:07 26 Feb
Hello Kathy,

If your company is conducting business in any other states than the state where you incorporated (or formed an LLC), then you need to register your business in those new states. This is often called “foreign qualification.”

Hope this helps!
Bill on 15:12 19 Feb
Hi,

We are based in the UK and have a Ltd company in the UK. We want to purchase from wholesalers in the US and sell on various eCommerce platforms in the US. Can we obtain a re sellers license in Oregon and sell out of a third parties warehouse in Michigan?
Can Salehoo assist with the paper work.

Regards

Bill
Richelle Monfort on 4:05 26 Feb
Hello Bill,

Only US based resellers can obtain sa US sales tax. Should the supplier ask one from you, you may inform them that you are based in the UK and provide your VAT number instead.

Sorry SaleHoo does not facilitate or assist in getting sales tax IDs or business licenses. I recommend consulting your local accountant, they should be able to assist you accordingly.

All the best!
Eliza on 22:10 7 Mar
Hi,

my company is based in Mexico and i want a resale cert, but i am not sure if i have to register my company and my tax ID in some government website ?

I want to buy from Texas but products cross the border, I in fact have proof that this is for re sale, but what should i do, or whom i have to do the paperwork done?

Richelle Monfort on 2:40 16 Mar
Hello Eliza,

You might want to check with your local account since your products will cross borders. Sorry I do not have enough training to give you an answer to your question.

All the best!
Autum on 16:25 16 Mar
Hello I design stationery from digital scrapbook kits at the moment only for family and friends for personal use. If I want to sell online either print to order or as a downloadable file, do I need to purchase a resale certificate or license? I live in Delaware also if that helps.
Richelle Monfort on 0:55 4 Apr
Hello Autum,

There is no sales tax in Delaware so no need to get one :)

All the best!
Andy on 19:33 21 Mar
I am a non us resident living outside the US. I have an llc formed in wyoming but have no nexus in the US. But i need a resellers certificate. How do i get one with no nexus as wyoming wont issue one with no nexus.
Richelle Monfort on 23:26 4 Apr
Hello Andy,

You will have to check with an accountant as to how you can go about getting a tax ID. As far as I know only US residents can get US tax IDs, since you are a non US resident it would be best to seek professional help.

All the best!
Helene Goodworth on 13:04 28 Mar
Hello!

I am a dressmaker and would like to buy my fabrics from a wholesaler. I think this means I need a reseller license. I have applied for one in my state (TN) but I don't have an LLC yet. Do I need to register my business before I can apply for my reseller license?

Thanks in advance!
Richelle Monfort on 23:25 4 Apr
Hello Helene,

If you are buying wholesale, or selling items you need a resellers ID. You will need a business license because you are a business end, and you need an EIN and a DBA to open a bank account.

Hope this helps!
margaret mathura on 12:10 4 Apr
I am in Canada. What tax ID I would need to sellinthe US and Canada from my Amazon sellers account?
Richelle Monfort on 0:43 5 Apr
Hello Margaret,

This Amazon forum thread should help with your concerns - https://sellercentral.amazon.com/forums/t/reseller-license-for-canadian-selling-in-u-s/388489/3

All the best!
Amos Ahchong on 23:56 5 Apr
Do I need that if I'm in New Zealand but purchasing goods from overseas?
Kasey on 8:21 21 Apr
Hi!

I currently work at a hotel and a mini golf business in Ocean City MD, but i live in Delaware. To provide better service to our customers I've often thought about reselling inexpensive items such as custom playing cards, flavored Icy pops, and any other little types of snacks or games that might be appropriate. Assuming that my employers would be okay with me doing such a thing on their property and time, what would you recommend my best coarse of action be?
James Saunders on 12:14 7 May 2018
Hi,

Here are some challenge questions :-)

I'm a US Citizen from Florida, but my physical address is in Europe. I'm planning to start two online stores that will sell mostly in USA and secondary in Europe and other countries(as a later plan).

I have not applied yet for my EIN but starting with my SSN and a virtual address in Oregon and when I get a few sales I plan to start an LLC in Delaware then register for an EIN and DBAs.

One of the two online stores will sell Print on Demand Products and one of the suppliers of this online store is located in the USA and the others in China. The second store will sell other products from USA factories/suppliers as a dropshipping. (both stores are going to be drop shipping directly to customers).

So my questions are:

A). Are the USA dropshipping suppliers be considered as my Nexus? (shipping is going to be from their based address but it is not MY warehouse but a different business from mine such as Amazon FBA)

B). To sell online only (via dropshipping) in the USA, for both stores, will I need a wholesale license or seller's license from all states in the US that I will be selling online too? Or from the states that the droppshiping suppliers are from? (my personal physical address is not in the USA).

C). Will I have to pay taxes to the state of Florida since I was born there or just income tax (federal tax) since my physical address is not in the US and not in Florida? And if I sell to Florida from my online stores will I have to pay state tax because I'm from that state?(I mean is Florida technically a Nexus for me)?

D). Do I need wholesale license or seller's license from Florida because I'm from that state? (I mean is Florida technically a Nexus for me)?

E). And if I start selling to Europe from the LLC company in Delaware do I need to get a VAT for that LLC for selling in Europe?

F). Does your reply to the above questions apply to the Delaware LLC I plan to create as well, or to me personally (if I do business as a sole proprietor)?

My physical address is in Europe for over 20 years.

Any feedback is appreciated even if it doesn't cover all my questions. Thanks in advance

Regards
James



Richelle Monfort on 5:33 10 May 2018
Hi James,

Because this is a delicate matter I suggest you consult with a professional so you will be given correct advise. Our training does not give us enough knowledge to answer your questions.

All the best!
Barbara Scott on 16:11 10 May 2018
I am a Canadian wanting to buy wholesale products from US suppliers and sell on Amazon.com. Can you tell me what license and approvals I need please?
Richelle Monfort on 4:12 14 May 2018
Hello Barbara,

It would be best that you check with your local account to be sure that you are guided accordingly.

All the best!
Neka on 11:45 30 May 2018
Hi ,
I am trying to get started with my online boutique. I wanted to know which licenses or permit I would need to start out with. I also am starting off as a Dropshipping business. I already have applied for my EIN number and have my business name that i want. What is actually a good place to register my business name? I have already gotten my website starting off with Spotify
Richelle Monfort on 1:01 31 May 2018
Hello Neka,

It's not always required to get started with most suppliers but there are quite a few benefits of obtaining one. I'd recommend you check out these two posts we wrote on the topic to give you a full understanding:

* https://www.salehoo.com/blog/why-suppliers-ask-for-documents
* https://www.salehoo.com/blog/how-to-get-a-reseller-license-sales-tax-id

Also this may help with your business registration concerns: https://www.sba.gov/business-guide/launch-your-business/choose-your-business-name

All the best!
Cid on 4:26 7 Jun 2018
Hi,
I want to start a dropshiping business, so I have doubt about the seeker ID.
I would like to know if this reseller ID is it just for who live's in US?
Thank you
Richelle Monfort on 3:39 8 Jun 2018
Hi Cid,

It's not always required to get started with most suppliers but there are quite a few benefits of obtaining one. I'd recommend you check out these two posts we wrote on the topic to give you a full understanding:

* https://www.salehoo.com/blog/why-suppliers-ask-for-documents
* https://www.salehoo.com/blog/how-to-get-a-reseller-license-sales-tax-id

If you live outside the US you may be asked to provide the equivalent like VAT ID (for UK and EU) or ABN (Australia).

Hope this helps!
Lola on 12:33 11 Jun 2018
Hi.
I am from a foreign conuntry but want to dropship products in the US from US manufactures. Do I need to register a company in the US and get a resellers certificate in order for the manufacturers to agree to work with me?
Richelle Monfort on 5:47 12 Jun 2018
Hello Lola,

No there is no need to register your business in the US. But you may be asked to provide the equivalent of a sales tax ID from your country.

All the best!
Ashley Y on 17:23 11 Jun 2018
Hello. I'm located in Pennsylvania and am looking to sell bows on Etsy as a hobby. I expect to make less than $600 a year. Do I still need to get a sales tax permit?
Richelle Monfort on 5:48 12 Jun 2018
Hello Ashley,

It would be best that you check with your local country clerk or accountant to be sure you're on the right path.

All the best!
BSYL on 19:08 2 Jul 2018
Hello there!

I am located in Ontario, Canada - but am currently trying to start an online boutique - purchasing wholesale from US / UK / AUS.

I got my Business Number, but I know most wholesale sites would ask for your reseller's permit.

I wanted to double check - that's just the TAX ID, correct?

In Ontario that would be the 15 digit # with "RT" right?

If so, this was the form I was going to fill out.

Thanks in advance!

https://www.canada.ca/content/dam/cra-arc/formspubs/pbg/rc1/rc1-17e.pdf
Richelle Monfort on 3:03 3 Jul 2018
Hi BSYL,

Please refer to this guide https://www.salehoo.com/education/business-setup/register-a-business-in-canada

Hope this helps!

 

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