How to Get a Resale Certificate in North Dakota
If you're starting a retail business or buying goods for resale in North Dakota, you need a sales and use tax permit and a Certificate of Resale. The permit registers you to collect sales tax, and the certificate is the form you give suppliers so you can buy inventory without paying sales tax on your purchases. Instead, you collect sales tax from customers and remit it to the state. Getting one is straightforward, but timing and accuracy matter.
What Is a Resale Certificate?
A Certificate of Resale is a form you give a seller to buy items for resale without paying sales tax. It is separate from the sales and use tax permit, which the North Dakota Office of State Tax Commissioner issues. With a permit and a completed certificate, you don't pay the North Dakota sales tax (currently 5%) on products you buy to resell to customers. You instead charge that tax to your customers and remit it to the state. Without a resale certificate, you'll pay sales tax on your inventory purchases, which increases your cost of goods sold and cuts into profits.
Any business making taxable sales in North Dakota must hold a sales and use tax permit. This includes online retailers shipping to North Dakota addresses, wholesalers, retailers, and service businesses that sell tangible goods. Sole proprietors, partnerships, LLCs, and corporations all need one.
Before You Apply: What You'll Need
Before starting the application, gather these materials. Having them ready speeds up the process and prevents delays.
- Business identification number or Social Security number: If you operate as a sole proprietor, you'll use your Social Security number. If you've incorporated or formed an LLC, use your EIN (Employer Identification Number) from the IRS. Don't have an EIN yet? Apply for one at
irs.govfirst. It's free and takes about 15 minutes online. - Business structure documentation: Have your Articles of Organization (LLC), Articles of Incorporation (corporation), or DBA registration (sole proprietor) on hand. You won't upload these, but you'll need to reference them.
- Business address: Your principal place of business in North Dakota. If you don't have a physical storefront yet, use your home address. This can't be a PO box.
- Ownership information: Names, titles, and ownership percentages for all owners. If you're a solo proprietor, just your name and title (e.g., Owner).
- Business description: A brief description of what your business does and what you sell. Examples: "Retail electronics," "Wholesale sporting goods," "Online clothing boutique."
- Expected monthly sales volume: A reasonable estimate. This doesn't lock you in, but it helps the state assess your reporting obligations.
Step-by-Step Application Process
Step 1: Visit the North Dakota TAP Portal
Go to https://tap.tax.nd.gov/?Link=Application in your web browser. This is the official North Dakota Taxpayer Access Point (TAP), managed by the Office of State Tax Commissioner. TAP handles all state tax permits and registrations, so this is the only official source. Do not use third-party tax services claiming to "speed up" the process; the state doesn't charge extra for expedited processing, and using an intermediary only adds cost and delay.
Step 2: Create or Log Into Your TAP Account
If this is your first time using TAP, click "Create New Account" or look for a registration link. You'll need an email address and a password. The state will email you a confirmation link; click it to verify your email before proceeding. If you already have a TAP account (perhaps from a prior business or filing), log in with your credentials. One account can manage multiple businesses, so reuse it if you own more than one entity.
Step 3: Select "New Application"
Once logged in, look for an option like "New Permit Application" or "Register for a Permit." Select the sales and use tax permit option. The system may also show you options for other tax accounts, such as withholding, but to sell taxable goods you need the sales and use tax permit.
Step 4: Provide Business Information
Fill in your business name exactly as it appears on your business registration (or as you intend to register it). Enter your business structure: sole proprietor, partnership, S corporation, C corporation, LLC, or other. If you're a sole proprietor, you can operate under a trade name (DBA), and you'll enter both your legal name and business name. Provide your principal place of business address in North Dakota. This must be a physical street address, not a mailbox store or PO box, though some counties allow rural routes. If you operate from your home, use your home address. The state sends mail here, so make sure it's current.
Step 5: Enter Owner and Operator Details
Provide names and Social Security numbers (or EINs) for the owners and responsible parties the application asks for. If you're a solo proprietor, this is just you. For partnerships or LLCs with multiple members, list each owner. The state uses this information to verify you're not delinquent on prior tax obligations. You'll also list the person responsible for filing and paying taxes (often the owner or a bookkeeper). This person will be the primary contact on the permit.
Step 6: Describe Your Business and Sales Activity
Explain what your business does and what types of goods or services you sell. If you sell mixed items (e.g., clothing and home goods), list the main categories. Estimate your monthly sales. This can be a range: "$5,000 to $10,000 monthly" is fine. The state sets your filing frequency when it issues the permit. Returns are quarterly by default, and monthly once your prior-year taxable sales reach $333,000. If you need to change your frequency later, contact the Office of State Tax Commissioner.
Step 7: Review and Submit
TAP displays a summary of everything you entered. Check every field for typos, especially your name, address, and tax ID. A misspelled address can cause mail to bounce; a wrong owner name can trigger verification delays. Once satisfied, click "Submit Application." The system immediately confirms receipt and assigns you a reference number. Save this number; you'll use it to check status or follow up with the state.
Step 8: Wait for Approval and Receive Your Permit
The Office of State Tax Commissioner publishes no approval time and advises applying about 30 days before opening. During this time, the state verifies your business information, checks for any prior tax debts, and processes the application. If there are any issues, they'll email or call you. Once approved, you'll receive your permit. State law issues one permit per place of business, valid until revoked, and requires you to display it at that location, so keep it safe and posted.
Tips to Avoid Common Mistakes
- Apply early: Don't wait until your opening day. If your permit hasn't arrived and you're two days from launch, you can't legally make taxable sales. The state recommends applying 30 days before you open. This gives you a cushion for questions or corrections.
- Use your correct legal name: If you're an LLC, use the exact name from your Articles of Organization. Sole proprietors should use their legal name, not just their business name. Mismatches between your permit and your business registration can create headaches later.
- Provide an address that receives mail: Don't use a business name without a physical address. The state sends important notices (filing reminders, audit notices, tax law changes) to your address on file. If mail bounces, you can miss deadlines and incur penalties.
- Estimate conservatively on expected sales: Overestimating doesn't give you a break; it just means the state expects higher returns. Underestimating slightly doesn't hurt, and if you exceed the estimate, you can ask for a filing frequency change.
- Don't confuse the permit with the Certificate of Resale: Your sales and use tax permit registers you with the state. The Certificate of Resale is the form you give each supplier to buy goods for resale without tax, and it includes your permit number. Keep that number handy.
- Collect sales tax from day one: The moment you make your first taxable sale, you must charge and collect the 5% sales tax. Don't wait for the permit to arrive. If you haven't collected tax on early sales, you'll owe it to the state yourself.
After Approval: What Comes Next
Once your permit arrives, your obligations begin immediately. Here's what to expect.
Collecting and remitting sales tax: On every taxable sale, you charge the customer 5% sales tax (or the applicable local rate if your county adds a surtax). You keep that money in a separate account and file a sales tax return monthly, quarterly, or annually depending on your filing assignment. Returns are filed through the same TAP portal where you applied. A late return adds a penalty of 5% of the tax due or $5, whichever is greater, plus 5% for each additional month up to 25%, and interest accrues on unpaid tax.
Record-keeping: Keep your records for three years and three months, as North Dakota law requires. You'll need receipts, invoices, and records of tax collected and remitted. The state may audit you, and these records are your proof of compliance. Digital records are fine; paper is acceptable too.
Buying without sales tax: Give wholesale suppliers a completed Certificate of Resale (or the Streamlined or Multistate Tax Commission resale form), which includes your permit number. Suppliers can check your permit number and business name in the state's permit lookup tool.
Renewals and updates: Your permit stays valid until it is revoked, and it is not transferable: if you buy an existing business, you must apply for a new permit. Keep your business information current through TAP.
Expected Results and Timeline
From the moment you submit your application to the moment you can legally collect sales tax, the Office of State Tax Commissioner publishes no approval time, so apply about 30 days before you open. Complete and accurate information helps avoid delays. Once approved, you're authorized to buy inventory without sales tax and to collect tax from customers. Returns are due on or before the last day of the month after each filing period ends (the month after each quarter for quarterly filers, or the month after each month for monthly filers).
Disclaimer
This article is informational and does not constitute legal or tax advice. Sales tax rules are complex, and your specific situation may differ from this general guide. If you have questions about whether you need a permit, which sales are taxable, or your filing obligations, contact the North Dakota Office of State Tax Commissioner at https://www.tax.nd.gov/ or call their business services line. For business formation questions beyond sales tax, consult a North Dakota CPA or attorney.