MS-11 Marketplace Sellers Purchasing Products for Resale from Tennessee Suppliers Must Provide a Resale Exemption Certificate

This article has been updated to reflect the repeal of Rule 96 and is effective January 10, 2022.

A marketplace seller purchasing products for resale from a Tennessee supplier must provide the Tennessee supplier with a resale certificate to make the purchase without tax.

In-State Marketplace Sellers

Marketplace sellers located in Tennessee register for sales and use tax and must provide a Tennessee supplier with its Tennessee Sales and Use Tax Resale Certificate or a fully completed Streamlined Sales and Use Tax Exemption Certificate including its Tennessee sales and use tax ID number to make the purchases for resale without tax.

Out-of-State Marketplace Sellers

Out-of-state marketplace sellers that are not registered for sales and use tax in Tennessee must provide a Tennessee supplier with its resale certificate issued by another state or a fully completed Streamlined Sales and Use Tax Exemption Certificate including the sales and use tax ID number issued by the other state and the state of issue. 

Sellers who are not Registered for Sales and Use Tax in Any State

If an out-of-state marketplace seller is not registered for sales and use tax in any state, the seller must provide a Tennessee supplier with a fully completed Streamlined Sales and Use Tax Exemption Certificate including a tax ID number for another type of tax (e.g., business tax or excise tax ID number) issued by its home state or its federal identification number (FEIN).

Sellers with no Tax ID Number or FEIN

If the marketplace seller does not have any tax ID number issued by its home state or a FEIN, the out-of-state marketplace seller must include its driver’s license number and state of issue in addition to the other required identifying information.

Sellers that use a Tennessee Supplier to Drop Ship Products to Tennessee Customers

A marketplace seller that has a Tennessee supplier drop ship products to its customer in Tennessee must provide a resale certificate to make such purchases without paying tax. Beginning January 10, 22, an out-of-state marketplace seller not registered in Tennessee, may provide a resale certificate issued by another state, or a fully completed Streamlined Sales and Use Tax Exemption Certificate including a sales tax ID number issued by another state and if not registered for sales tax in any state, another state issued tax ID number or its federal identification number (FEIN) to make the purchases for resale without paying tax.

Foreign Marketplace Sellers

A foreign marketplace seller that is not required to be registered in the United States must provide a fully completed Streamlined Exemption Certificate with a tax ID number issued by its home country to claim that it is entitled to purchase products for resale.

The Streamlined Sales and Use Tax Exemption Certificate and the corresponding instructions may be found at the following links: Streamlined Sales and Use Tax Exemption Certificate and Instructions 

Reference: Tenn. Comp. R. & Regs. 1320-05-01-.29(2) and 1320-05-01-.68(1-3).

Note: This article was updated on January 4, 2022. The previous version of MS-11 is available here.

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