Did checking a Kansas sales-tax exemption number online replace the retailer's duty to keep the purchaser's exemption certificate?

Plain-English summary

Kansas created an online service for retailers to verify Department-issued sales-tax exemption numbers. A retailer entered its own sales or compensating-use-tax registration number and the customer's exemption number. If both were valid, the service returned the exemption number, exempt entity name and address, and certificate expiration date; invalid entries produced a warning.

The online check did not replace the exemption certificate. K.S.A. 79-3609(a) barred a retailer from claiming an exempt sale unless the retailer possessed a properly executed certificate provided by the customer. The retailer still had to obtain and retain the certificate copy.

What this means for you

Use verification as a second control, not as the exemption document itself. Keep the purchaser's executed certificate and verify the number and expiration information under the current Department process.

Common questions

Q: Did an online “valid” result prove the retailer had all required documentation?
A: No. The retailer still needed the purchaser's properly executed exemption certificate in its records.

Q: What information did the service return?
A: The exemption number, entity name, address, and certificate expiration date.

Q: Who could use the verification tool described?
A: A retailer entering a valid Kansas sales or compensating-use-tax registration number.

Citations and references

• 2005 Senate Bill 13, § 2.
• K.S.A. 79-3609(a).

Subject

Verifying Kansas Exemption Certificates

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: Notice 05-07

Original ruling text

Notice
Notice Number: 05-07
Tax Type: Kansas Retailers' Sales Tax
Brief Description: Verifying Kansas Exemption Certificates
Keywords:
Approval Date: 07/01/2005

Body:
Kansas Department of Revenue
Office of the Secretary

                                                 Notice 05-07
                                    Verifying Kansas Exemption Certificates
                                                  July 1, 2005

2005 Senate Bill 13 Section 2 allows the Kansas Department of Revenue to release sales tax exemption information to
retailers to verify that the exemption numbers being presented by their customers are valid Kansas Department of
Revenue issued exemption numbers. The Kansas Department of Revenue has developed an on-line application
allowing retailers the ability to verify tax exemption certificate numbers at any time.

To use this service, please log onto the Kansas Department of Revenues web page at: www.ksrevenue.org and select
the link Sales Tax Exemption Certificates under the heading “Your business…”. This will take you to a page entitled
“Sales Tax Exemption Certificates” and you will want to select the Retailer link at the bottom of that page. This will take
you to the “Verification of Kansas Sales Tax Exemption Certificates” page, you may want to bookmark this page for easy
access in the future. You will be asked to enter your retailers sales or compensating use tax registration number and
then enter the exemption certificate number you wish to verify. If your retailers sales/compensating use tax registration
number and the exemption certificate number entered are valid, you will receive the following information: Exemption
Number, Exempt Entity Name, Address, City, State, Zip and Certificate Expiration Date. If either number is invalid you
will receive a notification to that fact across the top of the web page.

This service is for verification purposes only; retailers are still required to obtain a copy of the exemption certificate from
the purchaser and retain that copy on file. K.S.A. 79-3609(a) reads in relevant part: “any person selling tangible personal
property or furnishing taxable services shall be prohibited from asserting that any sales are exempt from taxation unless
the retailer has in the retailer's possession a properly executed exemption certificate provided by the consumer claiming
the exemption.”

Taxpayer Assistance

Additional copies of this notice, forms or publications are available from our web site, www.ksrevenue.org. If you have
questions, please contact:
Taxpayer Assistance Center
Kansas Department of Revenue
915 SW Harrison St., 1st Floor
Topeka, KS 66612-1588
Phone: 785-368-8222

Fax: 785-291-3614

Date Composed: 07/27/2005 Date Modified: 07/27/2005

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