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I just started my new business and I buy product WITHOUT paying tax and re-sell then I INCLUDE TAX on my receipts continued...

Grand Rapids, MI |

If I am doing work for an organization that is TAX EXEMPT ~ like my company - who then pays the tax or how to I bill it...My CPA is closed for a week (Tax Season) I need to do an estimate with them today. I am in the State of Michigan. How do I quote this job and wher do I place the tax liability? thank you.

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Attorney answers 3


You need to ask your own CPA who knows the retails about your business, and how your business relates to this other tax exempt business. No one on this site or any other anonymous, general, free site knows what your business is doing.

Avvo doesn't pay us for these responses, and I'm not your lawyer just because I answer this question or respond to any follow-up comments. If you want to hire me, please contact me. Otherwise, please don't expect a further response. We need an actual written agreement to form an attorney-client relationship. I'm only licensed in CA and you shouldn't rely on this answer, since each state has different laws, each situation is fact specific, and it's impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue.


I agree with the prior answer. Tax exempt projects can get very tricky, believe it or not. Sometime the vendor ends up owing the tax instead of the tax exempt customer making the whole transaction tax exempt.

Regarding bidding the project, I suggest throwing in language that the price presumes that the transaction will be tax exempt but that if taxes are deemed to apply, then they are included in the bid.

I hope this helps.

James P. Frederick

James P. Frederick


Very good suggestion.


You need to provide the details of the transaction before an answer can be given. Retail sales tax is generally assessed on the sale sale to the ultimate consumer. Therefor items sold wholesale, to anther seller are not taxed AT THAT STAGE. Many pele are also confused about what is actually tax exempt. Call my office, or anther attorney tomorrow with details.

To the PROSPECTIVE client, please call myself or another attorney for your choice with more detaiils and an appointment. My PRELIMINARY answer to your question(s) is for general purposes and based upon what little information you have conveyed. It is based on such limited information that the general answer should never be relied as a reason for your action or inaction. My response does NOT establish an attorney-client relationship and such may only be established by mutual agreement, and the signing of a written retainer agreement, which will generally require payment for our services, as this is what we do for a living and, just like you, we must get paid for our work.. .

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