RELATES TO:
KRS
139.010,
139.200,
139.260,
139.270,
139.280,
139.290,
139.300,
139.430,
139.440,
139.760,
139.990
NECESSITY, FUNCTION, AND CONFORMITY:
KRS
131.130(1) authorizes the
Department of Revenue to promulgate administrative regulations necessary for
the administration and enforcement of all tax laws in Kentucky. This
administrative regulation establishes requirements to consolidate and clarify
various provisions of the sales and use tax law as they relate to the
authorized issuance of resale certificates by purchasers and acceptance thereof
by retailers and sellers.
Section 1. A
resale certificate shall either be a "single purchase certificate" or a
"blanket certificate".
(1) A "Single purchase
certificate" shall include an itemization by the purchaser of the tangible
personal property, digital property, or services specifically enumerated in
KRS 139.200(g) through
(q) according to the provisions of
KRS
139.260(3) to be purchased.
A single purchase certificate may only be used for a single purchase of
applicable property and services for resale and shall not be used for
subsequent purchases.
(2) A
"Blanket certificate" shall include a general description by the purchaser of
the kind of tangible personal property, digital property, or services
specifically enumerated in
KRS 139.200(g) through
(q) according to the provisions of
KRS
139.260(3) to be purchased
for resale in the regular course of business. A purchaser who has executed a
blanket certificate shall not be required to execute additional certificates of
resale for individual purchases if:
(a) There
is no change in the character of the purchaser's operation; and
(b) The purchases are of applicable property
and services of the kind usually purchased by the purchaser for
resale.
Section
2. The resale certificate issued by the purchaser shall be in the
form of either the "Resale Certificate", Form 51A105, the "Streamlined Sales
and Use Tax Agreement - Certificate of Exemption", Revenue Form 51A260, or the
Multistate Tax Commission's "Uniform Sales and Use Tax Exemption/Resale
Certificate - Multijurisdiction".
Section
3. If the purchaser is not required to hold a permit because the
purchaser is a nonresident purchaser not required to register in Kentucky, the
purchaser may issue a fully completed:
(1)
Streamlined Sales and Use Tax Agreement - Certificate of Exemption (Revenue
Form 51A260); or
(2) Resale
Certificate (Revenue Form 51A105). If the purchaser issues a "Resale
Certificate", Form 51A105, the purchaser shall note on the face of the
certificate that the purchaser is a nonresident purchaser not required to
register and obtain a permit in Kentucky. The certificate shall bear the
purchaser's signature, name, address, and any other information requested on
the form. The purchaser shall clearly mark on the certificate whether it is a
single purchase certificate or a blanket certificate.
Section 4.
(1) If the retailer or seller has not
obtained a completed resale certificate in a timely manner according to the
provisions of
KRS
139.270, the burden of proving that a sale is
exempt as a sale for resale shall be upon the retailer or seller. The retailer
or seller may offer proof to the department that the sale in question is not
subject to tax in accordance with
103 KAR 1:010.
(2)
(a) For
example, if a retailer or seller only receives a completed resale certificate
from a restaurant business for silverware after the 120 day period required
under
KRS
139.270, the burden of proof shall be
considered "not met" and the retailer or seller shall remain liable for the
tax. The items in this example are for use within the restaurant business
rather than for resale.
(b) If the
retailer or seller receives a completed resale certificate in the course of a
department audit for purchases of disposable utensils from the same restaurant
business, the burden of proof shall be considered "met" because the product is
of the type resold in the normal course of the restaurant
business.
Section
5. Forms. The forms listed herein may be inspected, copied, or
obtained, subject to applicable copyright law, at:
(1) The Kentucky Department of Revenue, 501
High Street, Frankfort, Kentucky 40601;
(2) At a Kentucky Taxpayer Service Center
during business hours; or