Does Colorado Accept Out of State Resale Certificates?

Every state has its own set of guidelines when it comes to sales tax laws. It might be difficult to stay on top of the requirements in each state if you own a firm that operates in more than one. Is Colorado accepting out-of-state resale certificates? is one common query. Colorado does accept out-of-state sales certificates, to address your question. There are a few exceptions to be aware of, though. The certificate must, first and foremost, be valid in the state in which it was granted. Second, all pertinent information must be included on the certificate, including the buyer’s and seller’s names and addresses as well as a description of the goods being acquired.

If you own a business and sell goods in Colorado, you might be wondering if you have to collect sales tax from your customers there. In most instances, the answer is yes. The state sales tax in Colorado is 2.9%, and some municipal governments also levy their own sales taxes. Depending on where you are and what you are selling, the overall sales tax rate may change.

As long as the retailer has a current resale certificate, wholesalers that sell items to retailers in Colorado are often not obligated to collect sales tax. Wholesalers who deal directly with customers must, nevertheless, assemble sales tax.

Many jurisdictions have passed legislation in recent years requiring marketplace intermediaries to gather and send sales tax on behalf of third-party merchants. A marketplace facilitator is a business, like Amazon or Etsy, that offers a platform for merchants to sell products to buyers.

If they meet specific requirements, Colorado marketplace facilitators are obligated to gather and send sales tax on behalf of third-party merchants. This includes having 200 or more transactions or more than $100,000 in sales in the state during the current or prior year.

What about Etsy, then? Does the website charge Colorado sales tax? The response is affirmative as of January 1, 2019. Since Etsy is regarded as a marketplace facilitator in Colorado, they are obligated to gather and remit sales tax on behalf of vendors who satisfy the aforementioned requirements.

In conclusion, it’s critical to comprehend Colorado’s sales tax rules and how they relate to your company if you own a business there. Out-of-state resale certificates are accepted in Colorado, however there are several conditions that need to be satisfied. Furthermore, the majority of companies in Colorado are obligated to collect sales tax, and marketplace facilitators might also be in charge of gathering and remitting sales tax on behalf of third-party sellers.