If you run an Ecommerce or CPG business in Louisiana, securing a Louisiana Resale Certificate is a smart move to protect your margins and streamline operations.
This certificate allows you to purchase inventory and raw materials free from sales tax, helping you lower upfront costs, stay competitive in pricing, and remain compliant with Louisiana sales tax laws.
Understanding Resale Certificates in Louisiana
What is a Louisiana Resale Certificate?
In Louisiana, a Louisiana Resale Certificate is a document issued by the Louisiana Department of Revenue that allows businesses to:
- Purchase goods without paying sales tax, provided these goods are intended for resale to their customers in the normal course of their business.
- Make tax-exempt purchases of inventory and materials that will become part of the products they sell by presenting a valid resale certificate to their suppliers.
The purpose is to prevent double taxation, once at the wholesale level and again at the point of retail sale.
However, a Louisiana resale certificate is not a blanket exemption from all sales tax obligations. Businesses are still required to collect and remit sales tax on taxable sales to end consumers.
Why do you need a Resale Certificate in Louisiana?
Obtaining a resale certificate in Louisiana offers several significant advantages for businesses that purchase goods for resale.
Here are some key benefits:
- Avoid Paying Sales Tax on Inventory: The most direct benefit is that you can purchase inventory and materials for resale without paying Louisiana‘s sales tax upfront.
- Maintain Competitive Pricing: By not paying sales tax on the cost of goods, businesses have more flexibility in setting competitive prices for products in the Louisiana market. This can be a crucial advantage, especially in price-sensitive industries.
- Legal Compliance: Possessing and using a valid resale certificate for eligible purchases ensures businesses comply with Louisiana’s sales tax laws and regulations to avoid penalties.
In Louisiana, the specific form required for a resale certificate is the Louisiana Resale Certificate (Form R-1064).
When filling out Form R-1064, a purchaser must include their Louisiana Sales Tax Account Number to identify that it is registered with the Louisiana Department of Revenue (LDR) and authorized to make tax-exempt purchases for resale.
Resale Certificate vs. Sales Tax Permit: What’s the Difference?
A Louisiana Sales Tax Permit authorizes your business to collect and remit sales tax on taxable sales to customers. A Louisiana Resale Certificate (Form R-1064), on the other hand, allows you to purchase goods tax-free from suppliers if those goods are intended for resale. To use a resale certificate, you must have an active sales tax permit.
Who Can Use a Resale Certificate in Louisiana?
Businesses that purchase goods for resale can use a Louisiana Resale Certificate. To do so, the business must actively buy and sell tangible personal property and hold a valid Louisiana Sales Tax Permit.
How to Get a Resale Certificate in Louisiana: A Step-by-Step Guide
Getting a resale certificate in Louisiana is simple, but you’ll need to meet a few key requirements first. Here’s how to do it:
1. Make Sure You’re Eligible: Your business must purchase goods for resale to customers. Most businesses needing a resale certificate will also sell taxable tangible products and be registered with the Louisiana Department of Revenue by holding a valid Louisiana Sales Tax Permit.
2. Get a Louisiana Sales Tax Permit: If you don’t already have one, apply for a Louisiana Sales Tax Permit through the Louisiana Taxpayer Access Point (LaTAP) website. This permit is required before you can issue or use a resale certificate.
Need help? Read our blog: How to Get a Seller’s Permit in Louisiana
3. Gather Your Business Information: You’ll need basic business details to complete the resale certificate, including:
- Your name, address, sales tax account number, and type of business
- Seller’s name and address
- Short description of the business activity or the goods being sold.
- A signed declaration by the buyer certifying that the goods are for resale (this is part of Form R-1064).
4. Complete the Form R-1064: Download and fill out the Louisiana Resale Certificate (Form R-1064) from the Louisiana Department of Revenue website. You’ll present this form to your suppliers when making tax-exempt purchases.
5. Submission: Unlike some states that issue a separate physical resale certificate document, in Louisiana, you generally complete Form R-1064 and present a copy of it to your suppliers when making tax-exempt purchases for resale. Your eligibility to use this form is tied to your active Louisiana Sales Tax Permit and your compliance with the Louisiana Department of Revenue.
6. Pay Any Applicable Fees: There’s no cost to use the resale certificate itself (Form R-1064).
7. Manage Your Sales Tax Account and Verify Eligibility (via LaTAP): Although the Louisiana Department of Revenue doesn’t provide a personalized copy of Form R-1064 through LaTAP, keeping your sales tax account active and compliant is key to using it.
Through LaTAP, you can:
- Manage your Louisiana sales tax account.
- Access and print official documents such as confirmation letters related to your sales tax registration.
- Verify the validity of a Louisiana Resale Certificate – While Form R-1064 itself isn’t downloadable from LaTAP, having an active sales tax account confirms your eligibility to use the form.
8. Understand Renewal Requirements: The Louisiana Department of Revenue automatically renews resale certificates 60 days before the expiration date, as long as businesses report and pay their sales activity and taxes on time under LA R.S. 47:1678. If a certificate doesn’t qualify for automatic renewal, the business must renew Form R-1064 within 45 days of the expiration date.
Businesses must complete the renewal online through the Louisiana Taxpayer Access Point (LaTAP). The department won’t process requests submitted before the 45-day renewal period. Resale dealers who haven’t registered for LaTap must do so to renew their certificate.
How to Use a Resale Certificate in Louisiana
To properly utilize your resale certificate in Louisiana when making tax-exempt purchases for resale, you’ll need to present a valid copy of your Louisiana Resale Certificate to your supplier at the time of purchase.
Louisiana typically does not accept out-of-state resale certificates for purchases made within Louisiana. If your business is located outside Louisiana but makes tax-exempt purchases for resale in the state, you’ll generally need to register for a Louisiana Sales Tax Permit. Once registered, you must use the Louisiana Resale Certificate (Form R-1064) to make tax-exempt purchases. Your active sales tax permit serves as proof of your eligibility for the exemption.
For more information regarding sales tax exemption laws in Louisiana, you may visit the state website.
Multi-Jurisdictional Resale Certificates
A multi-jurisdictional resale certificate is a standardized form to simplify tax-exempt purchases for businesses that operate and make purchases for resale across state lines.
Unlike a standard resale certificate issued by a single state, a multi-jurisdictional certificate aims to be recognized and accepted by multiple states as valid proof that the goods being purchased are intended for resale and are therefore exempt from sales tax at the time of purchase.
However, it’s crucial to understand that not all states accept these multi-state forms, and acceptance can come with specific conditions.
There are two primary types of multi-jurisdictional resale certificates that a business operating in or selling to vendors in Louisiana might encounter:
- Uniform Sales & Use Tax Resale Certificate – Multijurisdiction Form: This is a widely recognized form accepted by a significant number of states (though not all). Louisiana does not accept this form as an alternative to its Form R-1064. You can find this form on the Multistate Tax Commission (MTC) website.
- Streamlined Sales Tax (SST) Certificate of Exemption: The state of Louisiana is not a Member State of the Streamlined Sales Tax of the Streamlined Sales Tax Governing Board website. As such, it does not accept the SST Certificate of Exemption for qualifying resale purchases.
Responsibilities When Using or Accepting a Resale Certificate in Louisiana
Buyer Responsibilities
If you’re using a Louisiana resale certificate, you’re responsible for ensuring it’s used only for purchases of goods or services you intend to resell. Using it for personal or operational items (like office supplies or equipment) is illegal and may lead to penalties.
- Louisiana-based buyers: Provide a fully completed Form R-1064 to your suppliers for qualifying purchases.
- Out-of-state buyers: Louisiana prefers its own resale certificate form. It does not accept out-of-state resale certificates. To make tax-exempt purchases for resale within the state, you must obtain a Louisiana-issued resale certificate. This applies to both in-state and out-of-state businesses purchasing goods for resale in Louisiana.
Seller Responsibilities
As a seller in Louisiana, accepting a resale certificate comes with the responsibility of verifying and retaining proper documentation for tax-exempt sales. You must:
- Verify the certificate’s validity: While accepting in good faith, you should utilize tools provided by the Louisiana Department of Revenue (LDR), such as their online Resale Certificate Validation tool on LaTAP, to confirm the buyer’s sales tax account number and the certificate’s active status.
- Accept the certificate in good faith
- Ensure it includes all required information: buyer’s name, address, sales tax permit number (or equivalent), reason for exemption, and signature.
- Reject the certificate if the items aren’t for resale (e.g., personal or business use)
Keep records for at least 4 years: A properly completed resale certificate is your official proof of why sales tax wasn’t collected. You must retain it in your records for at least four years.
Frequently Asked Questions About the Louisiana Resale Certificate
Are There Penalties for Misusing a Resale Certificate in this State?
Yes. Improper use of a resale certificate, such as using it for personal or non-resale purchases, can result in serious penalties. The state may hold any purchaser or agent who fraudulently signs this resale certificate without intending to resell the taxable items liable for all taxes, penalties, and interest due. Under Title 47 of the Louisiana Revised Statutes, misuse of this certificate may result in enforcement actions and collection efforts pursued against either the purchaser or seller.
Does a Louisiana Resale Certificate Expire?
Yes, a Louisiana Resale Certificate (Form R-1064) is generally valid for three years from its effective date. The Louisiana Department of Revenue (LDR) may automatically renew the certificate if your business consistently meets the following requirements:
- Timely filing of all required tax returns, including sales tax.
- Full payment of any taxes, interest, penalties, and fees owed to the state.
- Continued reporting of sales activity: extended periods of zero sales tax filings may disqualify a business from automatic renewal.
If your business does not qualify for automatic renewal, you’ll need to manually review the certificate online through the Louisiana Taxpayer Access Point (LaTAP). Keep in mind:
- The department typically accepts renewal requests within 45 days of the certificate’s expiration date.
- The team will not process requests submitted earlier than this 45-day window.
How Do I Verify a Louisiana Resale Certificate?
If you’re a seller in Louisiana, here’s how to validate a buyer’s resale certificate:
- Visit the Louisiana Taxpayer Access Point (LaTAP).
- Locate and select the “Resale Certificate Validation” section on the homepage
- Enter the seller’s Louisiana sales tax account number and their business name into the designated fields.
- On the subsequent screen, enter the purchaser’s Louisiana Account Number (as it appears on their resale certificate) and the purchaser’s legal business name.
Confirm Validity: After submitting this information, the system will display a message indicating whether the provided account number holds a valid resale exemption. If the certificate is valid, the system will also show its expiration date. Conversely, the system will display a clear message if it does not recognize the account number as valid for a resale exemption.
How TaxHero Can Help
Managing sales tax compliance and resale certificates in Louisiana doesn’t have to be complicated. TaxHero simplifies the process, from keeping your Louisiana Sales Tax Permit active to ensuring you use resale certificates correctly.
Save time. Avoid penalties. Stay compliant.
Schedule a Demo to see how TaxHero can streamline your Louisiana resale certificate process today!