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PUBLICATION 146 | APRIL 2014 - page 17 / 38

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Claimed exempt sales to Indians require documentation Retailers

When you make an exempt sale to an Indian purchaser as explained previously in this publication, you should keep copies of documents that BOE auditors can use to verify your sale is exempt. This generally requires documenta- tion that you transferred title to the property in Indian country and that the sale of the property was to an Indian purchaser. For example, you may obtain documentation such as the following:

  • One or more documents that show the purchaser is an Indian, such as a copy of the purchaser’s tribal ID card, a letter from a tribal council, or a letter from the U.S. Department of the Interior.

  • Documents to show that ownership of the merchandise transferred to the buyer in Indian country and delivery occurred there, such as contracts of sale, invoices, bills of lading, delivery receipts, and freight invoices.

To help you document exempt sales you may obtain an exemption certificate from the Indian purchaser. As discussed in more detail below, the exemption certificate should state that the Indian purchaser lives in Indian country. The exemption certificate will serve as support that the property was sold to an Indian. Therefore, if you obtain an exemption certificate, you will not need to obtain any additional documentation showing the purchaser is an Indian such as a tribal ID card. You will still need to retain documentation showing transfer of title and delivery of the property to the Indian in Indian country.

The BOE-146-RES, Statement of Delivery in Indian Country, and BOE-146-TSG, Property Used in Tribal Self-Governance and Statement of Delivery, are available at the end of this publication. The forms contain all of the required ele- ments of an exemption certificate. Additionally, they contain a section that may be completed by a notary public to document delivery of the property in Indian country or at the principal place where the tribal government meets to conduct tribal business. A notarized BOE-146-RES or BOE-146-TSG may be used to document delivery of the prop- erty when delivery is made by facilities of the retailer. The retailer is not required to obtain a notarized statement of delivery, but the retailer is required to obtain documentation demonstrating the property was delivered to the Indian purchaser in Indian country. If you obtain a properly completed and notarized BOE-146-RES or BOE-146-TSG, you do not need to obtain any additional documentation showing the property was delivered directly to the pur- chaser in Indian country. If the property is delivered by a common carrier or contract carrier, freight invoices or bills of lading will generally qualify as sufficient documentation of delivery to the Indian purchaser in Indian country.

If a state-licensed notary public is not readily available to document delivery of the property by facilities of the retailer in Indian country, please note that certification of delivery in Indian country by tribal council officers or their authorized representatives is also acceptable to document delivery of the property in Indian country.

Purchasers

If you are an Indian who lives in Indian country, you will need to provide documentation to the retailer that you qualify for the tax exemptions explained in this publication. Generally, you will need to provide the retailer with a signed exemption certificate stating that you live in Indian country. In lieu of providing the retailer with an exemp- tion certificate, you may provide the retailer with documentation showing you are an Indian, such as a tribal ID card, a letter from your tribal council, or a letter from the U.S. Department of the Interior, and documentation that you reside in Indian country.

APRIL 2014

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SALES TO AMERICAN INDIANS AND SALES IN INDIAN COUNTRY

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