18-125-302 Me. Code R. § 4

Current through 2024-51, December 18, 2024

Section 125-302-4 - Responsibilities of retailers and service providers - Sales to exempt organizations

Sales tax must be collected by the retailer, or paid by the service provider, on sales to entities that have not provided an exemption certificate to the retailer or service provider, and on sales of tangible personal property or services that are not related to the activity identified on the certificate issued to the entity. Retailers and service providers must maintain in their files a copy of the exemption certificate issued to any exempt organization to which they make a tax-exempt sale. Separate invoices of all tax-exempt sales must be retained by the retailer or service provider and appropriately marked. The words "Maine Sales Tax Exempt" or "Maine Service Provider Tax Exempt," together with a notation of the applicable exemption number, will satisfy this requirement.

Regardless of the specific method of payment, are tailer or service provider is not relieved of its burden of proving that a sale is exempt if it has, at the time of the sale, knowledge of facts that give rise to a reasonable inference that the purchaser is not the holder of the exemption certificate, that the exemption certificate has been revoked or is otherwise invalid as of the time of the sale, or that the tangible personal property or service is not to be used exclusively by the exempt organization primarily in the activity identified on the exemption certificate.

1.Direct billing. Sales that are billed directly to an exempt organization may be made tax-free without a purchase order or other documentation beyond that required by this rule.

2.Cash, personal check or personal bank card. Purchases paid for with cash, personal check, personal credit card, or personal debit card may not be made tax-free unless the purchaser presents a purchase order issued by the exempt organization that identifies the specific item or items, or the specific services, to be purchased. The retailer or service provider must retain the purchase order (or a copy) in its records.

Notwithstanding the previous paragraph, sales made to authorized employees or representatives on behalf of exempt organizations that are paid for with cash, personal check, personal credit card, or personal debit card may be made tax-free if a magnetic customer card issued by the retailer or service provider to the exempt organization and identifying the organization as tax-exempt is presented at the time of the sale by the authorized individual making the purchase and is recorded electronically by the retailer or service provider. The retailer or service provider must retain the digital information identifying the transaction and the purchaser. The customer card must:

A. Bear the name and signature of the specific individual authorized by the exempt organization to use it to make purchases; and

B. Contain a statement substantially similar to the following: "This card is to be used only by the individual named hereon for purchases authorized by [NAME OF EXEMPT ORGANIZATION]. If this card is used by the individual named hereon for any other purpose, the individual may be held liable for any applicable taxes, together with associated interest and penalties, and, if used to intentionally evade Maine tax due, may also be subject to criminal prosecution."

3.Other credit or debit cards. Purchases paid for with a credit card or debit card that is issued to a tax-exempt organization and that has the name of the organization on the face of the card may be made tax-free only if the retailer or service provider retains documentation that identifies the exempt organization, the sale transaction date, the sale price, the items or services purchased and the last four digits of the credit or debit card number.

18-125 C.M.R. ch. 302, § 4