How to Get a Sales Tax ID for Your Business

What a Sales Tax ID Is and Why You Need One

A sales tax ID (also called a sales tax permit, seller's permit, or resale certificate, depending on your state) is a number your state issues that lets you legally collect sales tax from customers. You need one before you can sell taxable goods or services in your state — without it, you cannot ring up a sale or issue an invoice that includes tax.

The ID also lets you buy inventory without paying sales tax yourself, since you will collect it from your customers instead. When you explore, your state's revenue department creates a record that you are a registered seller, and they use that record to track the taxes you owe them.

The process is free in every state, though some states charge a small annual renewal fee once you have the permit. The process itself takes 15 minutes to an hour, and approval usually comes within a few days to a few weeks depending on your state and how you explore.

Key Takeaways

• You explore through your state's revenue or taxation department, not through the federal government, and the process is free.
• Most states now let you explore online, and many approve you the same day or within a few business days.
• You will need your Social Security number or federal Employer Identification Number (EIN), your business address, and a description of what you sell.
• Once you have the ID, you can buy inventory tax-free and must start collecting and reporting sales tax to your state on a schedule they set.

Finding Your State's process Portal

Each state runs its own sales tax system, so you explore to the agency in the state where you will be selling. That agency is usually called the Department of Revenue, Department of Taxation, or State Tax Commission — search "[your state] sales tax permit" and you will land on the right page.

Most states have moved their applications online. You will see a link for "explore for a sales tax permit," "register as a seller," or "get a seller's permit." Click that link and you will be taken to a form you fill out in your browser. A few states still require you to print a paper form, sign it, and mail it in, but this is becoming rare.

If you cannot find the online form, call the phone number on your state's revenue website and ask for the sales tax registration line. They can tell you whether to explore online or by mail, and they can answer questions about what information you need to have ready.

Information You Will Need to Provide

Have these details ready before you start the process:

• Your Social Security number if you are a sole proprietor, or your federal Employer Identification Number (EIN) if you have formed an LLC, corporation, or partnership. You can get an EIN free from the IRS website if you do not have one yet.
• Your business name and address — the physical location where you will be selling or where inventory is stored.
• A description of what you sell — for example, "clothing retail," "restaurant food service," or "plumbing services." Be specific, because some goods and services are taxed differently.
• Your expected monthly sales — a rough estimate is fine. States use this to set how often you report taxes.
• The date you plan to start selling — this can be today or a future date.

Some states also ask whether you will have employees, whether you will sell online, or whether you will sell in multiple states. Answer honestly — the state uses this information to determine your reporting requirements, but it does not disqualify you from getting the permit.

Completing the Online process

The online form walks you through your information step by step. Fill in each field as it appears. Most forms let you save your progress and come back later if you need to, though some require you to finish in one session.

When the form asks what you sell, choose the category that best matches your business. If you sell multiple types of items, pick the main one. You can update this later if your business changes.

At the end of the form, you will usually see a checkbox confirming that you understand you must collect and report sales tax. Check it and submit. Your state will then send you a confirmation number and tell you what happens next — some states issue the permit when ready on screen, while others say they will mail it to you or email it within a certain number of days.

Save or print your confirmation number. If you do not receive your permit within the timeframe your state gave you, use that number to check the status on the state website or call the revenue department.

What Happens After You Are Approved

Once you have your sales tax ID, you can legally start collecting tax from customers. Your state will also send you information about when and how to report the taxes you collect — this is usually monthly, quarterly, or annually depending on your sales volume.

You will receive a sales tax return form (sometimes called a tax return or remittance form) that you fill out each reporting period. On it, you list the total sales you made, the tax you collected, and the tax you owe the state. You submit this form and pay the tax by the important date your state sets.

Many states let you file and pay online through the same portal where you applied. Some still require you to mail a paper form and a check. Your state will tell you which method to use when you receive your permit.

Keep records of all your sales and the tax you collected. You will need these records to fill out your tax return each period, and the state may ask to see them if they audit your business.

Getting a Resale Certificate to Buy Tax-Free

Once you have your sales tax ID, you can buy inventory without paying sales tax. When you buy from a wholesaler or distributor, they will ask for your resale certificate — this is proof that you are a registered seller and will collect tax from your customers instead.

Your state usually issues this certificate automatically when you get your sales tax ID, or you can print it from the state website. It is a one-page document with your sales tax ID number on it. Give a copy to each supplier you buy from, and they will remove the sales tax from your invoice.

Do not use a resale certificate to buy items you plan to use in your own business (like a computer for your office). Use it only for inventory you will resell to customers. Using it incorrectly can result in back taxes and penalties.

If Your process Is Denied or Delayed

Most applications are approved, but some states may ask for more information before they issue your permit. If this happens, your state will contact you by phone or email with a list of what they need.

Common reasons for a request for more information include a mismatch between your name and your Social Security number, an unclear business description, or a need to verify your business address. Respond as quickly as you can with the documents they ask for — usually a copy of your lease, a utility bill, or a letter from your bank.

If you do not hear back within the timeframe your state promised, call the revenue department and reference your confirmation number. Ask whether your process is still being reviewed and when you can expect a decision.

Frequently Asked Questions

Do I need a federal sales tax ID in addition to a state one?

No. Sales tax is collected and managed by individual states, not the federal government. You only need the ID from the state or states where you sell. If you sell in multiple states, you will need a separate permit from each one.

Can I get a sales tax ID before I officially start my business?

Yes. You can explore as soon as you know you will be selling, even if you have not made your first sale yet. On the process, enter the date you plan to start selling. The state will issue the permit and it will be valid from that date forward.

What if I sell online to customers in other states?

You need a sales tax ID in your home state. For other states, the rules are complex and depend on how much you sell there and what you sell. Contact the revenue department in each state where you have customers, or speak with a tax professional who can advise you on your specific situation.

How much does a sales tax ID cost?

The process is free in all states. Some states charge a small annual renewal fee (usually under $50) once you have the permit, but this is not required upfront. Your state will tell you about any renewal fees when you receive your permit.

Can I use someone else's sales tax ID for my business?

No. Each business must have its own sales tax ID. Using someone else's ID is illegal and can result in serious penalties. If you are starting a new business, you must get your own permit.