While requirements vary by state and other factors, exemption certificates must generally be collected in a "timely" manner. Many states mandate that a exemption certificate is collected prior to delivery of goods and services, within the seller’s normal billing cycle or within 90 days of the sale. This means that in most cases you won’t be able to shrug of the responsibility to collect certificates until after you get audited. If you haven’t been collecting exemption certificates at all, an auditor may see your lack of timely collection as a jackpot penalty opportunity. Furthermore, even in with potential leniency and extra time to collect certificates, you may run into situations where it may be impossible to obtain a certificate (A business may be non-responsive or dissolved). Through timely and regularly collection of exemption certificates, you can dramatically reduce your audit risk.
Can't I just wait to collect certificates until I get audited? Print
Modified on: Wed, 14 Apr, 2021 at 7:23 PM
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