California CDTFA Issues Special Notice on Proper Use of Resale Certificate for Sales Tax Purposes

The California Department of Tax and Fee Administration (CDTFA) May 1 issued a special notice on the proper use of a resale certificate for sales and use tax purposes. Taxpayers holding a California seller’s permit can issue a resale certificate when purchasing items for resale in the regular course of their business operation. However, it’s improper to use a resale certificate when there’s no intent to resell the items. The notice also covers: 1) taxability of products purchased under a resale certificate and later withdrawn from resale inventory; 2) penalties for improper use of a resale certificate; 3) requirements for ...