When you sell or lease merchandise, vehicles, or other tangible personal property in California, even temporarily, you are generally required to register with our agency, the California Department of Tax and Fee Administration (CDTFA), and to pay sales tax on your taxable sales. When you register, we will issue you a seller's permit. Sometimes people incorrectly refer to a seller's permit as a resale number or resale permit. A seller's permit is a state license that allows you to sell items at the wholesale or retail level and to issue resale certificates to suppliers. Issuing a resale certificate allows you to buy items you will sell in your business operations without paying amounts for tax to your suppliers.
Generally, if you make three or more sales in a 12-month period, you are required to hold a seller's permit. This applies even if your sales are made through Internet auction houses, such as eBay and uBid, or websites that offer online classified advertisem*nts (online advertisers) such as Craigslist. For additional information, please see publication 177, Internet Auction Sales and Purchases, or call our Customer Service Center at 1-800-400-7115 (TTY:711).
When you have a garage sale and sell used items, you are generally not required to hold a seller's permit unless you have more than two garage sales in a 12-month period or are required to hold a seller's permit for being engaged in the business of selling merchandise, goods or items (tangible personal property). Please see Regulation 1595, Occasional Sales – Sale of A Business – Business Reorganization.
Making sales of merchandise, goods or other items in California without first getting a seller's permit violates the law and subjects you to fines and penalties. California law requires a seller's permit be held for warehouse locations when: the retailer has one or more sales offices in this state, the sale is negotiated out of state, and the order is filled from the retailer's in-state stock of goods at the warehouse. You are not required to hold a seller's permit if all your sales are made exclusively in interstate or foreign commerce, and you make no sales in this state. However, your business may meet the requirements of a "qualified purchaser" and you may be required to register for a use tax account as discussed in the next section.
Click here for more information:
https://www.cdtfa.ca.gov/formspubs/pub107/
For information on if you get caught operating without a sellers permit click here:
https://www.cdtfa.ca.gov/formspubs/pub166.pdf
How to apply for a California sellers permit click here:
https://www.cdtfa.ca.gov/formspubs/pub107/#applying
steve@stevesimsea.com
