Your Resale Certificate & EIN
(This is an excerpt from a University Of Metaphysical Sciences course at www.umsonline.org,
please feel free to visit the school website)
Another filing you must do in order to conduct business is to obtain your seller’s permit, which is called a Resale Certificate. This is a number you obtain, and a certificate that you can display on your wall, showing that you have registered with your state for collecting sales tax on any products that you sell. You must collect sales tax on anything you sell that requires sales tax. Every state has different requirements as to what they want you to collect sales tax on. Generally, services like ministerial counseling, teaching classes and things like this are not taxed and therefore you would not be collecting sales tax on those services. If you are selling products, most likely you will be required to collect sales tax on these tangible items. There are a few states that do not require sales tax on tangible items, but you can only be sure by checking with your own state agencies. A place to start would be the Secretary of State’s office if you do not know who to contact about this issue. They can guide you in the right direction as to who you need to speak to.
The other thing that the resale certificate does for you is allows you to buy things tax free that you use in your practice. For instance, if you make up meditation tapes of your Sunday services, your classes, or the sessions that you have with your clients for your client’s later use, then you will need to buy tapes in bulk. When you buy these tapes in bulk and you have your resale certificate, you will be able to buy them without paying sales tax. If you do not have the resale certificate you will be required to pay tax on those tapes, even though you are buying them wholesale. If you resell the tapes you will be required to collect sales tax on them yourself. If they are included with your service, you may or may not be required to charge sales tax on them depending on how your state structures its sales tax requirements.
You will need to file for an EIN (Employer Identification Number) with your state. Again, contact the Secretary of State and they will be able to guide you to the right agencies to speak with about this. Even if you are never going to have employees, technically you must have an EIN in order to legitimately operate. If you put yourself on payroll this will come into play. If you end up having employees, your EIN will be required on your quarterly reports. This process does not actually cost money in most states. You will need this number in order to file your corporation with the IRS.