| (3) Use of taxable item as a trade-in. A purchaser
who gives a valid resale certificate instead of paying tax on the
purchase of a taxable item is liable for sales tax if the purchaser
uses the taxable item as a trade-in on the purchase of another taxable
item. Tax must be paid on the original purchase price of the taxable
item used as a trade-in.
(4) Use of taxable item outside Texas. Texas sales
or use tax is not due on a taxable item removed from a valid tax-free
inventory for use by the purchaser outside the state.
(5) Lost or destroyed inventory. Texas sales or use
tax is not due on tangible personal property purchased under a valid
resale certificate that is totally destroyed or permanently disposed
of by the purchaser in a manner other than for use or sale in the
normal course of business. For example, documented theft, casualty
damage or loss, or disposal in a landfill. This does not apply to
consumable items that are completely used up or destroyed by the purchaser
in the course of performing a service in Texas.
(f) Improper use of a resale certificate; criminal
offenses.
(1) A person may not issue a resale certificate at
the time of purchase for a taxable item if the person knows the item
is being purchased for a specific taxable use.
(2) Any person who intentionally or knowingly makes,
presents, uses, or alters a resale certificate for the purpose of
evading Texas sales or use tax is guilty of a criminal offense. For
more information, see §3.305 of this title (relating to Criminal
Offenses and Penalties).
(g) Content of a resale certificate. A resale certificate
must show:
(1) the name and address of the purchaser;
(2) the number from the sales tax permit held by the
purchaser or a statement that an application for a permit is pending
before the comptroller with the date the application for a permit
was made. If the application is pending, the resale certificate is
valid for only 60 days, after which time the resale certificate must
be renewed to show the permanent permit number. If the purchaser holds
a Texas sales and use tax permit, the number must consist of 11 digits
that begin with a 1 or 3. Federal employer's identification (FEI)
numbers or social security numbers are not acceptable evidence of
resale. See also subsection (d)(2) of this section regarding registration
numbers for retailers outside Texas;
(3) a description of the taxable items generally sold,
leased, or rented by the purchaser in the regular course of business
and a description of the taxable items to be purchased tax free by
use of the certificate. The item to be purchased may be generally
described on the certificate or itemized in an order or invoice attached
to the certificate;
(4) the signature of the purchaser or an electronic
form of the purchaser's signature authorized by the comptroller and
the date; and
(5) the name and address of the seller.
(h) Form of a resale certificate. A resale certificate
must be substantially either in the form of a Texas Sales and Use
Tax Resale Certificate or a Border States Uniform Sale for Resale
Certificate. Copies of both certificates are available at comptroller.texas.gov
or may be obtained by calling our toll-free number 1-800-252-5555.
A seller may also accept as a resale certificate the Uniform Sales
and Use Tax Certificate-Multijurisdiction promulgated by the Multistate
Tax Commission and available online at http://www.mtc.gov. The Streamlined
Sales and Use Tax Agreement Certificate of Exemption may not be accepted
as a resale certificate.
|
| Source Note: The provisions of this §3.285 adopted to be effective January 1, 1976; amended to be effective November 17, 1981, 6 TexReg 4064; amended to be effective November 19, 1984, 9 TexReg 5717; amended to be effective November 24, 1987, 12 TexReg 4196; amended to be effective September 18, 1991, 16 TexReg 4957; amended to be effective December 28, 1993, 18 TexReg 9311; amended to be effective March 12, 1996, 21 TexReg 1687; amended to be effective July 26, 1998, 23 TexReg 7381; amended to be effective October 12, 2004, 29 TexReg 9550; amended to be effective November 1, 2017, 42 TexReg 6024; amended to be effective October 13, 2020, 45 TexReg7269 |
