Tax exempt customer w/ resale exemptions

Accounting & Taxes
1

I have some HVACR contractor customers who are tax-exempt on products they purchase from us for resale. They don’t pay tax when buying these items from us because they collect sales tax when they sell to their own customers. However, these same customers still need to be taxed on items they purchase for their own use, like raw materials and tools, which won’t be resold to their customers.

To manage this, I need a way to charge tax only on the items they use internally and not on items they will resell. What’s the best way to set this up in our system?

2

If they are using it for their own purposes, it is their responsibility to handle it themselves. Your part is to mark them exempt based on the Certificate and keep a record of the Certificates.