The ST-3 New Jersey form is a resale certificate that allows sellers to collect sales tax on taxable property or services, unless a fully completed exemption certificate is provided by the purchaser. This form ensures that the seller is not held liable for tax collection when the purchaser qualifies for an exemption. To proceed, fill out the ST-3 form by clicking the button below.
The ST-3 form, commonly referred to as the New Jersey Resale Certificate, plays a critical role in the state's sales tax system. This form allows purchasers to buy taxable goods or services without paying sales tax, provided they are intended for resale or specific exempt uses. To utilize this certificate, the purchaser must complete it fully, including their New Jersey Taxpayer Registration Number, business type, and details about the items or services being purchased. The seller must retain this certificate for at least four years, ensuring compliance with tax regulations. The ST-3 form outlines several scenarios in which it can be used, such as purchasing items for resale in their current form or as components of a new product. However, it also delineates situations where the use of the form would be improper, such as when a business buys supplies for its own use rather than for resale. Understanding the proper use of the ST-3 form is essential for both buyers and sellers to navigate the complexities of sales tax obligations in New Jersey.
ST-3
New Jersey Division of Taxation
(3-23)
Sales Tax
Resale Certificate
Check applicable box:
Single-Purchase Certificate
Blanket Certificate
The seller must collect Sales Tax on the sale of taxable property or services unless the purchaser gives them a fully completed exemption certificate.
Do not mail this form to the Division of Taxation.
Seller
Name
Address
Street
City
State
ZIP Code
Purchaser
New Jersey Taxpayer Identification Number
Name*
As registered with the New Jersey Division of Taxation
Address*
Type of Business*
The purchaser certifies that:
(1)They hold a valid Certificate of Authority to collect New Jersey Sales and Use Tax.
(2)They are principally engaged in the sale of (indicate nature of property or service sold):
(3)The property or services being purchased are described as follows:
(4)The property described above is being purchased for (check all boxes that apply):
Resale in its present form.
Resale as converted into or as a component part of a product by the purchaser.
Use in the performance of a taxable service on personal property and will become part of the property being serviced or will later be transferred to the purchaser of the service in conjunction with the performance of the service.
(5)The services described above are being purchased (check the box that applies):
By seller who will either collect tax or will resell services.
To be performed on personal property held for sale.
I, the undersigned purchaser, have read and complied with the instructions and rules promulgated pursuant to the New Jersey Sales and Use Tax Act with respect to the use of the resale certificate, and it is my belief that the seller named herein is not required to collect the Sales or Use Tax on the transaction or transactions covered by this certificate. The undersigned purchaser hereby swears under the penalties for perjury and false swearing that all of the information shown in this certificate is true.
Print Name
Authorized Signature*
(Owner, Partner, Corporate Officer)
Title
Date
*Required
This form may be reproduced
Form ST-3 Instructions
Completing the Certificate
To claim an exemption from Sales Tax on the purchase of taxable property or services, the purchaser must provide a fully completed exemption cer- tificate to the seller. Otherwise, the seller must collect the tax. The purchaser must provide the following information for the exemption certificate to be considered fully completed:
•• Name and address;
•• New Jersey taxpayer identification number;
•• Type of business;
•• Reason(s) for exemption;
•• Signature, if using a paper exemption certificate (including fax).
The seller’s name and address are not required for the exemption certificate to be considered fully completed.
Accepting the Certificate
A seller must be registered to accept an exemption certificate. The seller is relieved of liability for collecting Sales Tax on transaction(s) covered by the certificate as long as the certificate is fully completed and is received within 90 days of the date of sale. The seller is relieved of liability even if the pur- chaser improperly claimed the exemption, in which case the purchaser will be held liable for nonpayment of the tax.
Accepting the Certificate in an Audit Situation
If the seller either has not obtained an exemption certificate or has obtained an incomplete exemption certificate, the seller has at least 120 days after the Division’s request for substantiation of the claimed exemption to either:
1.Obtain a fully completed exemption certificate from the purchaser taken in good faith, which in an audit situation means the exemption:
•• Was statutorily available on the date of the transaction(s); and
•• Could apply to the property or service being purchased; and
•• Is reasonable for the purchaser’s type of business; or
2.Obtain other information establishing that the transaction(s) was not subject to tax.
If the seller obtains this information, the seller is relieved of any liability for the tax on the transaction unless it is discovered through the audit process that the seller had knowledge or had reason to know at the time the information was provided that the information relating to the exemption claimed was materially false or the seller otherwise knowingly participated in activity intended to purposefully evade the tax that is properly due on the transaction. The burden is on the Division to establish that the seller had knowledge or had reason to know at the time the information was provided that the informa- tion was materially false.
Blanket Certificates
A single exemption certificate may cover additional purchases of the same general type of property by the same purchaser with which the seller has a recurring business relationship. For purposes of this section, a recurring business relationship exists when a period of no more than 12 months elapses between sales transactions.
To use this form as a blanket certificate, check the applicable box at the top of the form. Each subsequent sales slip or purchase invoice based on the blanket certificate must be clearly marked with the purchaser’s name, address, and identification number.
Retention of Certificates
Certificates must be retained by the seller for four years from the date of the last sale covered by the certificate. Certificates must be in the physical possession of the seller and available for inspection. A seller that enters data elements from paper into an electronic format is not required to retain the paper exemption certificate.
Examples
Proper Use of Form ST-3
1.A retail appliance store owner issues a resale certificate when purchasing appliances from a supplier for resale.
2.A furniture manufacturer issues a resale certificate when purchasing lumber to be used in manufacturing furniture for sale.
3.A service station operator issues a resale certificate when purchasing auto parts to be used in repairing customers’ cars.
Improper Use of Form ST-3
In the examples below, the seller cannot accept a resale certificate and must collect Sales Tax.
1.A lumber dealer cannot accept a resale certificate from a tire dealer that is purchasing lumber for use in altering its premises.
2.A distributor cannot issue a resale certificate on purchases of cleaning supplies and other materials for its own office maintenance, even though it is in the business of distributing such supplies.
3.A retailer cannot issue a resale certificate on purchases of office equipment for its own use, even though it is in the business of selling office equipment.
4.A supplier cannot accept a resale certificate from a service station that purchases tools and testing equipment for use in its business.
5.A contractor cannot issue Form ST-3 for purchases of materials and supplies. If the property being worked on belongs to a qualified exempt orga- nization, a qualified Urban Enterprise Zone business, or a qualified housing sponsor, see Contractor’s Exempt Purchase Certificate (Form ST-13) and Contractor’s Exempt Purchase Certificate - Urban Enterprise Zone (Form UZ-4).
For more information, see S&U-6, Sales Tax Exemption Administration, which is available at www.nj.gov/treasury/taxation/pdf/pubs/sales/su6.pdf
Filling out the ST-3 New Jersey Resale Certificate is essential for ensuring that sales tax is handled correctly during transactions involving taxable property or services. This certificate allows the purchaser to claim an exemption from sales tax when buying items for resale. Follow these steps to complete the form accurately.
Once the form is filled out and submitted to the seller, they will retain it for their records. This process ensures that the transaction is exempt from sales tax, provided all information is accurate and complete.
The ST-3 form, also known as the Resale Certificate, is used in New Jersey to allow a purchaser to buy taxable property or services without paying sales tax at the time of purchase. The seller must collect the tax unless the purchaser provides a fully completed ST-3 form, indicating their eligibility for exemption.
The purchaser must complete the ST-3 form. They must provide their New Jersey Taxpayer Registration Number, business type, and details about the merchandise or services being purchased. The seller should retain this form for their records.
The form requires several key pieces of information:
Sellers must keep the ST-3 form for at least four years from the date of the last sale covered by the certificate. The form must be physically available for inspection during this time.
If a seller does not collect sales tax and does not have a properly completed ST-3 form, they may be held liable for the tax. However, if the seller obtains a fully completed exemption certificate within 120 days after a request for substantiation, they may be relieved of this liability.
Yes, the ST-3 form can cover additional purchases by the same purchaser of the same general type of property. Each subsequent invoice must still include the purchaser’s name, address, and registration number for verification.
Yes, here are examples:
Filling out the ST-3 New Jersey form can be straightforward, but many people make common mistakes that can lead to complications. One frequent error is failing to include the purchaser’s New Jersey Taxpayer Registration Number. This number is essential for the seller to validate the exemption. Without it, the exemption certificate may not be accepted, resulting in the seller needing to collect sales tax.
Another common mistake is not providing a complete description of the merchandise or services being purchased. The form requires specific details about what is being bought. Vague descriptions can lead to misunderstandings and may cause the seller to reject the exemption certificate.
People often neglect to check the appropriate boxes regarding how the merchandise will be used. The form includes several options, such as for resale or as a component part of a product. Failing to check the relevant boxes can create confusion about the intended use and invalidate the exemption.
Additionally, many purchasers overlook the need for a signature. The form requires the signature of the owner, partner, or corporate officer. Without this signature, the certificate is incomplete, and the seller may not accept it, leaving the purchaser liable for sales tax.
Another mistake involves not reading the instructions carefully. The ST-3 form includes detailed guidelines that are crucial for proper completion. Ignoring these instructions can lead to errors that could have been easily avoided.
Some individuals also mistakenly assume that the seller’s name and address are required on the form. However, this information is not necessary for the exemption certificate to be considered complete. This misunderstanding can lead to unnecessary delays in processing the form.
People sometimes fail to retain the certificate for the required period. Sellers must keep the exemption certificate for at least four years from the date of the last sale covered by it. Not adhering to this requirement can result in penalties during audits.
Lastly, many purchasers do not realize that the ST-3 certificate covers only specific types of purchases. Using the certificate for inappropriate purchases, such as office supplies for personal use, can lead to serious tax implications. Understanding the limits of the exemption is crucial for compliance.
When engaging in transactions that involve the New Jersey ST-3 Resale Certificate, several other forms and documents may be necessary to ensure compliance with tax regulations. Each document serves a unique purpose and helps facilitate the proper handling of sales tax exemptions. Below is a list of commonly used forms that may accompany the ST-3.
Understanding these forms and their purposes can streamline the process of handling sales tax exemptions in New Jersey. By using the correct documentation, both buyers and sellers can ensure compliance with tax regulations and avoid potential issues down the line.
The ST-3 New Jersey form, which serves as a resale certificate, shares similarities with several other documents related to sales tax exemptions. Here are four documents that are comparable:
When filling out the ST-3 New Jersey form, it’s important to follow specific guidelines to ensure compliance and avoid issues. Here’s a list of what you should and shouldn’t do:
Understanding the ST-3 New Jersey form can be challenging, and several misconceptions can lead to confusion. Here are six common misunderstandings about the ST-3 Resale Certificate:
By clarifying these misconceptions, businesses can better navigate the use of the ST-3 form and ensure compliance with New Jersey tax laws.
Here are some key takeaways about filling out and using the ST-3 New Jersey form: