Certificate of Authority?

Discussion in 'Growing and Managing a Business' started by byathread, Feb 17, 2013.

  1. byathread

    byathread
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    Hello!

    I have recently started my LLC for a small clothing line. I registered a wholesale account with a place that sells clothing at wholesale prices. They asked me for a number of things like:

    • State Resale Permit
    • Sales and Use Tax ID
    • Certificate of Authority

    I managed to get the first 2, but I'm not sure where I should apply for the certificate of authority. I am in Minnesota, they are in New York. I sent 2 emails to them asking for clarification, but they didn't reply back.

    From what I understand, it seems that the COA is needed to do business in a foreign state, but I am doing local and internet sales. I am ASSUMING that I need the COA to purchase items from them, so I would need to get the COA for the state of New York.

    Can anyone confirm this please? Thank you!

    Chris
     
  2. Ted

    Ted
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    Chris,

    The Certificate of Authority is a document issued by New York State Department of Taxation and Finance to New York based businesses.

    The only think on the certificate of authority is your tax ID number, your business name, your business address and the date that the certificate was validated by New York State. Businesses that operate in New York are supposed to have this document on display at their place of business according to New York State law.

    It is issued to businesses that have a physical address in New York. If you don't intend to open a physical store in New York, then you should not need one. Any business that wants to operate in New York and collect sales tax in New York needs to have one. In fact, according to the law as I understand it, businesses in NY are prohibited from conducting business and collecting sales tax until they get this document from New York State.

    According to what you have written here, I don't think you need one.

    In Minnesota you probably have a comparable document that is your state business license. It should have your Federal Tax Id number on it. That is the document that this place is probably asking for.
     
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  3. byathread

    byathread
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    Thank you for the response. It makes perfect sense. Take it easy Ted!
     

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