Certificate of authority: New York sales tax registration, and the other meaning

Anyone making sales in New York that are subject to sales tax, even from home, as a temporary vendor or only once a year at a craft fair. How often you sell or how much you charge does not usually decide it.

An out-of-state seller needs one if it is a vendor in New York: for example, with a place of business there, or with more than $500,000 of sales delivered into New York and more than 100 such sales in the previous four quarters.

The steps, from the New York Tax Department:

New vendors file sales tax returns quarterly, due March 20, June 20, September 20 and December 20. You file even in a quarter with no sales, and even if you never open; the minimum late-filing penalty is $50. Vendors with $300,000 or more of taxable sales and purchases in a quarter switch to monthly filing, and those owing $3,000 or less a year may be moved to annual.

Amend the certificate within 20 days if your business name, address, federal ID, owners or responsible persons change. A certificate cannot be transferred: a new owner needs their own, and so does a change of legal form such as a sole proprietorship becoming a corporation. When you close or sell, surrender the certificate and file a final return.

From summer 2027, New York will require every current certificate holder to re-register, notifying each by certified mail at least 180 days before their certificate expires. Re-registering costs nothing, but all fixed and final tax debts must be paid first.

If you will sell for no more than two consecutive sales tax quarters in any 12-month period, you can get a temporary Certificate of Authority, with start and end dates, using the same application. Show and entertainment vendors cannot use a temporary certificate; they need a regular one even if they sell only occasionally.

New York’s penalties are steep compared with the effort of registering:

An LLC or corporation is formed in one state, its home state. To do business in another state it registers there as a "foreign" company. Depending on the state this is called a certificate of authority, a registration or an admission. Without it, the company can face penalties and may not be able to sue in that state’s courts.

In Illinois, an out-of-state LLC files Form LLC-45.5, Application for Admission to Transact Business, for $150 ($400 for a series LLC), with a certificate of good standing from its home state dated within the last 60 days, and then files a $75 annual report like any Illinois LLC. An out-of-state corporation files Form BCA 13.15, Application for Authority to Transact Business, with a minimum of $150 in filing fee and franchise tax and a certified copy of its articles dated within the last 90 days; a corporation that does business in Illinois before qualifying owes a penalty of $200 plus $5 a month, or 10% of its fees and taxes if more, plus interest.