Streamlined Sales and Use Tax Agreement (SSUTA) 317: Section 317 Administration of exemptions

When a purchaser claims an exemption, the seller obtains the purchaser's identifying information and the reason for the exemption at the time of purchase, as the Governing Board specifies; uses the standard Governing Board form for electronic claims; obtains the same proof whatever the sales medium; keeps proper records of exempt sales and gives them to a state on request. No signature is required unless a paper certificate is used, and a state may issue exempt purchasers an identification number to present. States administer use-based and entity-based exemptions through direct pay permits, certificates or other means that do not burden sellers, and must let a drop shipper claim resale based on its customer's certificate or other information whether or not the reseller is registered in the destination state. A seller that follows the section is relieved of tax if the exemption proves improper and the purchaser is liable, except for fraud, soliciting unlawful claims, or accepting an entity-based claim for goods received at the seller's own location in a state whose uniform form clearly greys out that exemption. A seller that obtains a fully completed certificate or the data elements within ninety days after the sale is relieved; failing that, it has one hundred twenty days after a state's request for substantiation to obtain a good-faith certificate (an exemption statutorily available on the date, possibly applicable to the item and reasonable for the purchaser's business) or other proof the sale was not taxable, and is then relieved unless the state shows it knew or had reason to know the information was materially false or it knowingly took part in evasion. A blanket certificate covers a recurring relationship (no more than twelve months between sales) and states may not ask for its renewal. Each state posts the uniform certificate with non-applicable exemptions greyed out.