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FAQ Articles

I have customers that claim they are exempt from sales tax. How do I know if my customers are exempt and what type of records do I need to document exempt sales?

Generally, the type of document presented by the customer determines if the customer is exempt from sales tax or if they are purchasing for resale. In North Dakota, most tax-exempt entities other than some U.S. government agencies (see below) receive a Certificate of Exempt Status – Exempt Organization issued by the Tax Commissioner. A copy of the sales tax exemption certificate must be presented to the retailer at the time the exempt organization makes a purchase. The retailer must keep the certificate on file in case of an audit. Exemption certificates do not expire and do not have to be renewed or reissued like a Certificate of Resale. A Federal Employer Identification Number is not a valid exemption number, nor is having a Federal Income Tax exemption status of a non-profit organization as recognized in 501 c 3. North Dakota does not recognize exemption certificates or numbers issued by other states or government entities or a Federal Employer Identification Number as a valid exemption number. An application should be completed and submitted to the office for review to determine if you are eligible for a North Dakota Sales Tax Exemption Certificate.

Exempt organizations include all government entities, schools (public and nonprofit private), federally chartered corporations, hospitals, skilled nursing facilities, basic care facilities, assisted living facilities, and emergency medical providers licensed by the North Dakota Department of Health and Human Services and qualifying nonprofit voluntary health organizations.

The United States government and its agencies, the state government and all of its political subdivisions are exempt from paying sales tax provided payment for the purchase is made directly by a government warrant, government check or a government credit card that is paid directly by the government agency. Individuals who represent any of these agencies while on government business are subject to sales tax in this state if they pay by personal check, personal credit card, or with a government credit card that is billed to the individual and paid for by the individual who then is reimbursed by the government agency.

Customers buying for resale must present a Certificate of Resale to the seller at the time of the sale. A copy of a retailer’s sales tax permit or providing only the sales tax permit number may not be used as a resale certificate. We accept the North Dakota Certificate of Resale with the permit holder’s home state and sales tax number entered on the form or the Multi-Jurisdiction Uniform Sales & Use Tax Certificate. For more information regarding the Certificate of Resale and the purchase of goods for resale, please refer to the Requirements for Sales and Use Tax.

nd.gov - The Official Portal for North Dakota State Government
North Dakota: Legendary. Follow the trail of legends

Ryan Rauschenberger
Tax Commissioner
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FAQ Articles

I have customers that claim they are exempt from sales tax. How do I know if my customers are exempt and what type of records do I need to document exempt sales?

Generally, the type of document presented by the customer determines if the customer is exempt from sales tax or if they are purchasing for resale. In North Dakota, most tax-exempt entities other than some U.S. government agencies (see below) receive a Certificate of Exempt Status – Exempt Organization issued by the Tax Commissioner. A copy of the sales tax exemption certificate must be presented to the retailer at the time the exempt organization makes a purchase. The retailer must keep the certificate on file in case of an audit. Exemption certificates do not expire and do not have to be renewed or reissued like a Certificate of Resale. A Federal Employer Identification Number is not a valid exemption number, nor is having a Federal Income Tax exemption status of a non-profit organization as recognized in 501 c 3. North Dakota does not recognize exemption certificates or numbers issued by other states or government entities or a Federal Employer Identification Number as a valid exemption number. An application should be completed and submitted to the office for review to determine if you are eligible for a North Dakota Sales Tax Exemption Certificate.

Exempt organizations include all government entities, schools (public and nonprofit private), federally chartered corporations, hospitals, skilled nursing facilities, basic care facilities, assisted living facilities, and emergency medical providers licensed by the North Dakota Department of Health and Human Services and qualifying nonprofit voluntary health organizations.

The United States government and its agencies, the state government and all of its political subdivisions are exempt from paying sales tax provided payment for the purchase is made directly by a government warrant, government check or a government credit card that is paid directly by the government agency. Individuals who represent any of these agencies while on government business are subject to sales tax in this state if they pay by personal check, personal credit card, or with a government credit card that is billed to the individual and paid for by the individual who then is reimbursed by the government agency.

Customers buying for resale must present a Certificate of Resale to the seller at the time of the sale. A copy of a retailer’s sales tax permit or providing only the sales tax permit number may not be used as a resale certificate. We accept the North Dakota Certificate of Resale with the permit holder’s home state and sales tax number entered on the form or the Multi-Jurisdiction Uniform Sales & Use Tax Certificate. For more information regarding the Certificate of Resale and the purchase of goods for resale, please refer to the Requirements for Sales and Use Tax.

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