Form Pub Ks-1520 - Kansas Exemption Certificates Page 12
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49items ($70.00) under “Merchandise Consumed” (line
Policy Information Library
2) of her sales tax filing. The amount becomes a part of
the net sales total on which sales tax is due.
As a service to taxpayers our web site contains a
library of policy information for all taxes administered
by KDOR. This policy library contains the Kansas
PAYING TAX ON PERSONAL USE OF INVENTORY
Statutes and Regulations, Revenue Notices, Revenue
Rulings and other written advice issued by KDOR.
All of the exemption certificates in this booklet have
Opinion Letters and Private Letter Rulings are also
this statement above the buyer’s signature:
included, but are “scrubbed” to protect the privacy of
the taxpayer — any information that would identify the
“The undersigned purchaser understands and agrees
taxpayer, such as name, address, product, etc., is
that if the property or services are used other than as
blanked out.
stated above or for any other purpose that is not exempt
from sales or compensating tax, the undersigned
purchaser becomes liable for the tax.”
Key Statutes and Regulations
When you remove merchandise from your inventory
The information in this guide is based on these
to use personally or as a gift, you become the final
statutes and regulations and others cited are in the text.
consumer or user of the item(s) and must pay the sales
They are a part of the policy library on our web site.
tax due. The sales tax is based upon your cost for the
item, not its retail price.
K.S.A. 79-3602 – Sales tax definitions
K.S.A. 79-3603 – Taxing statute
To report and pay the tax on tax exempt inventory
K.S.A. 79-3606 – Exempting statute
used for a taxable purpose, use the line or column of
K.S.A. 79-3651 – Exemption certificates
your sales tax filing entitled “MERCHANDISE
K.A.R. 92-19-25b – Exemption certificates
CONSUMED.” Retailer/contractors will also use this line
K.A.R. 92-19-66e – Project Exemption certificates
or column to report the cost of materials removed from
a tax exempt inventory for use on a contract job.
RELATED TOPICS
WHEN IN DOUBT ...
When there is a question that is not answered in this
booklet, contact KDOR. DO NOT GUESS. Clarification
AUDIT ISSUES
of whether a sale is taxable or exempt will save you time
in dealing with the issue in the future and could also
save you money by avoiding costly sales tax deficiencies.
Your sales tax records, including exemption
certificates, are subject to audit by KDOR. If your
Many questions can be answered by the customer
exemption certificates are found to be missing or
representatives in our office, or by consulting KDOR’s
incomplete during an audit, you have only 120 days
Policy Information Library on our web site. However,
from notice by the Director of Taxation to obtain
there are unique situations that may require an
completed exemption certificates for these sales.
interpretation or clarification based upon the law,
(K.S.A. 79-3609(a)).
regulations, and specific facts of the case. When this
Since our audits usually cover a three-year period,
happens, document the problem or question in writing
this task can be very time-consuming. If you cannot
and request a Private Letter Ruling or an Opinion Letter
from KDOR. Mail or fax your request to:
locate the customer or he refuses to comply, you may
become liable for the sales or use tax due on that sale,
Office of Policy and Research
plus penalty and interest.
Kansas Department of Revenue
915 SW Harrison St., Room 230
Avoiding Common Errors. Here are some of
Topeka, KS 66612-1588
the most common exemption certificate errors we
Fax: 785-296-7928
find during an audit with tips on how to correct
or avoid making these mistakes.
You will receive a written ruling within 30 days after
your request (and any additional information necessary
An exemption certificate is incomplete.
for the ruling) is received.
Completing every blank on the certificate designed
IMPORTANT: Although they are published in
for that exemption will help to avoid most errors of
our Policy Information Library (see below)
omission. All exemption certificates must have the name
Opinion Letters and Private Letter Rulings are limited
of the seller, the name and address of the purchaser,
ONLY to the requesting taxpayer and that taxpayer’s
the reason it is exempt, and be signed and dated by
specific factual situation. They cannot be relied upon
the purchaser.
or cited by any other person.
12
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Parent category: Financial