Do Seller’s Permit Amounts Vary by State?
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Do Seller’s Permit Amounts Vary by State?

To sell taxable items or tangible goods, a business must have a permit, whether it’s an LLC, corporation, or partnership or run by an individual. In California, CA sellers permits are managed by the State Board of Equalization. With a seller’s permit, CA businesses can sell items/goods at the wholesale or retail level; one must register with the board to legally do business where the goods, merchandise, vehicles, or personal property are sold.

The rules vary from state to state, so how to get a seller’s permit in California may be different than somewhere else. In some states, the permit is called a sales tax license. The challenge of getting a permit, generally in the form of a slip of paper, varies, as does the fee.

There is no California seller’s permit cost because the state does not charge a fee. However, a security deposit may need to be paid, which covers unpaid taxes should the business close later. Some other states that offer a zero application fee include:

  • Alabama
  • Alaska
  • Delaware
  • Georgia
  • Idaho
  • Illinois
  • Iowa
  • Kansas
  • Kentucky
  • Louisiana
  • Maine
  • Maryland
  • Massachusetts
  • New York
  • New Jersey
  • Pennsylvania
  • South Dakota
  • Texas

States small and large may or may not charge fees. Rhode Island charges $10, while Connecticut tops the list at $100. A sales and use tax permit in the state is valid for five years and is automatically renewed at no cost.1

How to Obtain a Seller’s Permit in Different States

Each state has its own rules. Here’s a look at what some states charge, to help understand how they are different from California:

  • Colorado: $16 for a two-year license, plus a one-time $50 deposit.
  • Indiana: $25, valid for two years with no renewal charge.
  • Missouri: Variable, with no fee for sales tax ID number, but there’s a bonding requirement for those engaged in retail sales.
  • Nevada: $15, plus a variable security deposit; fees are charged based on location.
  • Oklahoma: $20, plus $10 for additional locations; licenses can be renewed every three years if the business is in good standing.

In other states, application charges are:

  • Arizona: $12
  • Arkansas: $50
  • Florida: $5
  • Hawaii: $20
  • Ohio: $25
  • Rhode Island: $10
  • South Carolina: $50
  • West Virginia: $30
  • Wisconsin: $20
  • Wyoming: $60

The specific rules and requirements vary per state as well. In California, you can apply electronically online but must have bank account details and an estimate of the sales you expect to make. There are also rules regarding recordkeeping. Tax records should be held for at least four years.

How to Obtain a Seller’s Permit in Different States

A California seller’s permit number is provided as well. This identifies your business for tax purposes and is important if you purchase the business because you’ll need to know the previous owner’s name and permit number. If the previous owner owes sales or use tax, you may not have to pay it if a tax clearance is requested prior to your purchase. Knowing the specific rules for your state is important; non-compliance can affect eligibility for renewal and incur penalty fees.

For additional California seller’s permit information and details on applying, contact FastFilings.com or call (415) 857-3301.

Sources

  1. https://www1.avalara.com/trustfile/en/blog/sales-tax-permits-their-current-state-by-state.html
  2. https://www.boe.ca.gov/pdf/sales_in_ca.htm

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