How to Get a Resale Certificate in Indiana

Suppose you’re starting a limited liability company (LLC) in Indiana and planning to sell goods subject to sales tax. In that case, you’ll need to get a resale certificate, or several of them, before doing business. 

But don’t worry; this guide lays out all you need to do to get a resale certificate in Indiana.

What Is a Resale Certificate?

If your LLC expects to sell tangible goods in Indiana, a resale certificate will enable you to purchase those goods without paying sales tax. This prevents your goods from being double taxed, as you will need to charge your customer’s sales tax when they buy the goods. 

If you purchase goods without paying sales tax and neglect to charge sales tax to customers who buy those goods, or if you fail to sell the goods, you and your LLC will be responsible for the sales tax and could face steep fines. 

If you purposely purchase an item not intended for resale, such as office equipment, and use your resale certificate to avoid paying sales tax, that’s tax fraud, a federal offense. In Indiana, penalties, depending on the amount of tax owed, could result in the following:

• Level 6 Felony – 6 months to 2.5 years in jail and a fine of up to $10,000
• Class A Misdemeanor – up to 1 year in jail and a fine of up to $5,000

Each resale certificate applies to only one vendor, so you’ll need one for each of your vendors. 

Suppliers and vendors do not have to accept resale certificates. However, a vendor might refuse a resale certificate because if your certificate is invalid, the vendor would be responsible for the sales tax.

How to Obtain a Resale Certificate in Indiana

To obtain a resale or sales tax exemption certificate in Indiana, visit the Department of Revenue website to download the form.

You’ll fill out a form for each of your vendors.

Once you have the certificate, present it to your vendor and keep a copy for your records.

Does a Resale Certificate Expire in Indiana?

Resale certificates do not expire unless it’s specified on the form that the certificate is for a single purchase. 

In Closing

In Indiana, a resale certificate is relatively easy to obtain yet provides significant savings. It will also help you and your LLC avoid potentially substantial penalties. 

Be sure to present the correct certificate to your vendors and keep track of expiration dates so your certificates are always current. You don’t want to find yourself paying sales tax when you don’t have to.