Documentation for Tax-free status?

[Anthropos_77]

What is the name of your state? Florida
I am a non-resident alien (from Trinidad) planning to market a proprietary hardgood to the US market via an on-line store.

I will start by having a contract manufacturer dropship product to my retail customers on my behalf using my tradename and trademark. I will re-imburse the contractor at regular intervals. The same procedure will apply when I have wholesale customers.

Q1. Manufcturers usually require me, as a reseller, to show a tax ID. Will I need a tax-free certificate to procure certain business services?
Q2. Does it make a difference tax-wise whether I position myself as a (marketing) manufacturer or a sole distributor/ agent for the product?
Q3. Is there anything I need to know on this matter besides the fact that I don't need to pay US tax? Any recommended reading?

Regards
Antropos_77

[LdiJ]

Originally Posted by Anthropos_77

What is the name of your state? Florida
I am a non-resident alien (from Trinidad) planning to market a proprietary hardgood to the US market via an on-line store.

I will start by having a contract manufacturer dropship product to my retail customers on my behalf using my tradename and trademark. I will re-imburse the contractor at regular intervals. The same procedure will apply when I have wholesale customers.

Q1. Manufcturers usually require me, as a reseller, to show a tax ID. Will I need a tax-free certificate to procure certain business services?
Q2. Does it make a difference tax-wise whether I position myself as a (marketing) manufacturer or a sole distributor/ agent for the product?
Q3. Is there anything I need to know on this matter besides the fact that I don't need to pay US tax? Any recommended reading?

Regards
Antropos_77

In this instance you aren't really a resaler.....you are contracting them to manufacture a product for you. Are you actually going to be making retail sales? If you are, then you really need to talk to a US corporate/business attorney in Florida.

[Anthropos_77]

Thank you., Ldij
I posted a reply several days ago, but perhaps there was an error in the process. So I'm posting it again. Sorry for this delay.

By “retail”, I mean selling online to end users. It is a test-marketing phase to iron out problems and get feedback while I prepare for and develop the wholesale market. The product is a desk accessory made of sheet acrylic; it is a simple but innovative design that can be cost-effectively manufactured in relatively small quantities.

The manufacturers in this field also make display units for stores, brochure holders, and numerous other items from sheet acrylic. They retail, wholesale, and drop ship their own stock in any desired quantity. They also make custom products in short order in any desired quantity. The larger the order, the cheaper the price per unit. So I will start with a relatively small stock and grow from there into wholesaling.

In view of the foregoing, what is your opinion?

Regards
Anthropos_77

[LdiJ]

Originally Posted by Anthropos_77

Thank you., Ldij
I posted a reply several days ago, but perhaps there was an error in the process. So I'm posting it again. Sorry for this delay.

By “retail”, I mean selling online to end users. It is a test-marketing phase to iron out problems and get feedback while I prepare for and develop the wholesale market. The product is a desk accessory made of sheet acrylic; it is a simple but innovative design that can be cost-effectively manufactured in relatively small quantities.

The manufacturers in this field also make display units for stores, brochure holders, and numerous other items from sheet acrylic. They retail, wholesale, and drop ship their own stock in any desired quantity. They also make custom products in short order in any desired quantity. The larger the order, the cheaper the price per unit. So I will start with a relatively small stock and grow from there into wholesaling.

In view of the foregoing, what is your opinion?

Regards
Anthropos_77

Florida doesn't have sales tax, therefore I can't imagine why a manufacturer in Florida would ask you for a tax ID. I was in manufacturing for years, and we never asked our OEM customers for a tax ID. In this instance you are the manufacturer, you are merely contracting out the work.

[anteater]

Originally Posted by LdiJ

Florida doesn't have sales tax,.....

Eh? Last I knew, it was 6% for the state and generally another 1/2% - 1% for the locals.

[LdiJ]

Originally Posted by anteater

Eh? Last I knew, it was 6% for the state and generally another 1/2% - 1% for the locals.

Ok...maybe I am wrong on that one...if so, I am sorry. I could have sworn that FL was one of the few states that didn't have sales tax.

[chitown]

Florida does not have a state Imcome taxe but does have a 6% state sales tax . Each county and/or city after voting referendum typically applies an additional .25 to 1.5 mill to the statutory rate. Florida has a standard tax exempt certificate that is typically copied and provided to your vendors, they are required to keep this on file in case of sales tax audit. It must be renewed annually with the Fla Dept of Revenue. Believe it is $50 but probably has increased. You will need to provide to your vendors/suppliers if you are NOT the ultimate consumer of the goods. Legally, they must assess sales tax if you do not provide the exempt certificate. Services are not subject to sales tax in Floirda. except in some defined instances such as processing raw food items. For example, if you buy raw shrimp it is not taxable, but if you want it steamed before you purchase it becomes subject to sales tax.

[Anthropos_77]

Originally Posted by chitown

Florida has a standard tax exempt certificate that is typically copied and provided to your vendors, they are required to keep this on file in case of sales tax audit.
You will need to provide to your vendors/suppliers if you are NOT the ultimate consumer of the goods.
Legally, they must assess sales tax if you do not provide the exempt certificate. Services are not subject to sales tax in Floirda..

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REPLY: (Florida state)

I have been reviewing information from an online search and need to do read more.

However, it seems clear that I will be tax-free owing to my NRA status, and that:
(a) As manufacturer, I purchase the services of a contractor rather than sell such a service; and
(b) As a retailer, sole distributor, sales rep, or manufacturer’s agent, I do not take possession or ownership of inventory, but receive a compensation or commission for transacting sales.
Of course, I will confirm all this in detail and be guided accordingly.

Thanks all
Anthropos_77