Explanation of Exemption Certificate
An exemption certificate allows an individual or organization relief from certain taxes or fees. These certificates are usually granted by a state agency. They provide a financial break for those who meet criteria.
Expiration and Renewal
Some tax exemption certificates expire. In at least 9 states like Florida, Illinois, Kansas, Kentucky, Maryland, Nevada, Pennsylvania, South Dakota, and Virginia, certificates last for five years. Renewal is required in these states to avoid penalties.
Types of Exemptions in the US Sales Tax System
The US sales tax system is complicated with multiple types of tax exemption certificates that your business may qualify for or receive from customers. Some organizations, like governmental bodies and some nonprofits, can purchase items tax-free for their own use with “entity exemption certificates.” Others qualify for exemptions based on how they will use purchases with usage-based resale certificates.
Application and Fees in Wisconsin
In Wisconsin, to apply for exempt status complete form S-211 with effective sales tax exemption date when the form is signed. Dealer license fees are as follows:
- Trailer dealer plate: $75 (1st 2 plates, $5 more)
- Transporter plate: $75 (1st 2 plates, $5 more)
- Wholesale dealer license: $40
Exemption for Certain Medical Conditions
People with certain medical conditions can get free NHS prescriptions if they have a valid medical exemption certificate which entitles you to free NHS prescriptions only and doesn’t cover dental treatment or help with other health costs.
Resale Certificates
Resale certificates are the documents that let retailers purchase goods for resale without having to pay sales tax. If a state-generated form is needed, it is typically located in the business’ online sales tax account with the state and can be provided directly to the seller without any additional information or signature needed from the buyer.
Exemption from Workers’ Compensation Insurance
Exemption from workers’ compensation insurance can only be provided by the NYS Workers Compensation Board via the issuance of the CE-200. The CE-200 is only available from Workers Compensation Board. A valid certificate or “cert” identifies a policy which is effective during your same policy period. It shows the independent contractor or subcontractor as the “insured” and shows your company as the Certificate Holder.