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03.06.01.14


.14 RESALE CERTIFICATES.

A. Definitions.

(1) In this regulation, the following terms have the meaning indicated.

(2) Terms Defined.

(a) "Antique" means any item of personal property that:

(i) Was made in an earlier period;

(ii) Has special value because of its age; and

(iii) Is at least 70 years old.

(b) Used Collectible.

(i) "Used collectible" means an item of personal property that has been
previously sold at retail as a new item and in which there is a general interest
in collecting the item.

(ii) A general interest in the collection of an item is demonstrated by sales of
the item at antique and collectible shows and shops or the existence of
associations or publications dedicated to the collection of the item.

B. Except as provided in §§C and D of this regulation, the duty of a vendor to
collect the sales and use tax from a buyer is waived if the buyer provides the
vendor with a signed resale certificate. The resale certificate need not be in a
particular form, but it shall state the name, address, and the Maryland sales
and use tax registration number of the buyer, and state that the tangible
personal property, digital code, digital product, or taxable service is bought
for the purpose of resale.

C. Purchases for Less Than $200.

(1) A vendor may not accept a resale certificate from a buyer for purchases of
less than $200 using cash, check, credit card, debit card, or electronic
transfer of funds, unless the vendor delivers the goods directly to the buyer's
retail place of business.

(2) A buyer may obtain a refund of sales and use tax paid on a purchase
described in §C(1) of this regulation, if made for resale by claiming a credit
on the next sales and use tax return or filing a claim for refund.

D. Sale of an Antique or Used Collectible.

(1) For the sale of an antique or used collectible, the duty of a vendor to
collect the sales and use tax from the buyer is waived if the buyer provides the
vendor with a signed resale certificate that contains the information set forth
in §B of this regulation, except instead of a Maryland sales and use tax
registration number, the certificate states that the buyer is an out-of-State
vendor who does not sell or deliver tangible personal property or a taxable
service for use in Maryland; does not otherwise engage in the business of an
out-of-State vendor as described in Tax-General Article, §11-701(b), Annotated
Code of Maryland; or does not meet the thresholds for economic nexus as defined
in Regulation .33B(5) of this chapter, and:

(a) Contains:

(i) The sales and use tax registration number of another state; and

(ii) A copy of a sales and use tax registration license issued to the buyer from
that state; or

(b) If a buyer is from a state without a sales and use tax, instead of a sales
and use tax registration license and number, a copy of a trader's license from
that state or a comparable type of identification.

(2) Except as set forth in this section, all other requirements of this
regulation including those of §C of this regulation, apply to the sale of an
antique or used collectible.

E. A vendor shall obtain a resale certificate before a sale is consummated to
support every transaction for which the resale exclusion is claimed. A buyer
making repeated purchases from a vendor may provide a blanket resale certificate
to the vendor and claim the resale exclusion on subsequent purchases by
providing the buyer's Maryland sales and use tax registration number on its
purchase orders.

F. When the Comptroller notifies a vendor of an intent to assess the tax on
transactions for which the vendor does not possess proper resale certificates,
the vendor shall have 60 days from the mailing of this notice to obtain the
certificates. If the vendor fails to obtain proper resale certificates within
this 60-day period, the Comptroller's assessment is final.

G. A vendor may not accept a resale certificate at any time, including the
60-day grace period, if at the time of acceptance the vendor knows or should
know that the sale is not for resale.

H. Maryland sales and use tax registration numbers contain 8 digits, the first
of which is always either a zero or a one. Numbers issued by other
jurisdictions, federal employer or Social Security numbers, or numbers
containing alphabetic characters are not valid on a resale certificate.

I. In third-party drop shipment transactions, in which a Maryland registered
vendor sells to an out-of-State unregistered vendor and the property is
delivered to a Maryland location, the Maryland vendor shall either require the
out-of-State vendor to register for Maryland sales and use tax purposes and
provide a proper resale certificate, or charge the tax based on the selling
price to the out-of-State vendor. The obligation of the Maryland-registered
vendor to obtain a proper resale certificate bearing a Maryland registration
number or charge the tax is not changed because the out-of-State vendor is in
fact making a sale for resale or the Maryland customer is entitled to the resale
exclusion or any other exemption.

J. Vendors may accept resale certificates that bear the exemption certificate
number issued to a religious organization instead of a sales and use tax
registration number. Sales and use tax exemption certificate numbers issued to
religious organizations consist of 8 digits, the first two of which are always
"29". Other private exempt entities may not use their exemption certificate
numbers on resale certificates. These entities shall register as vendors and use
their sales and use tax registration numbers on resale certificates.