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Lev, Tax Advisor
Category: Tax
Satisfied Customers: 29577
Experience:  Taxes, Immigration, Labor Relations
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I have a business in Illinois and I used a business in Wisconsin

Customer Question

I have a business in Illinois and I used a business in Wisconsin to do a service for me. They have asked me to fill out a Wisconsin Sales and Use Tax Exemption Certificate. I don't have a sales tax number for Wisconsin. Should I get a sales tax number for each state that I have a service done in or go ahead and fill out the form and if they ask for a sales tax number, I give my Illinois number?
Submitted: 1 year ago.
Category: Tax
Expert:  Lev replied 1 year ago.
The issue is that sales tax are regulated by each state separately.When services are provided in Wisconsin and such services are subject to Wisconsin sales tax (based on that state sales tax laws and regulations) - providers will have to charge you sales tax unless you register with Wisconsin taxing authorities and provide sales tax exemption certificate. So the question is about the place where services provided and whether that sale is subject to sales tax in Wisconsin.
Customer: replied 1 year ago.
Since the service was done in Wisconsin. I will either have to pay taxes on it or apply for a sales tax id from the state of Wisconsin?
We have a lot of work done for us in Iowa as well. I would have to apply for a sales tax id there too.?
Expert:  Lev replied 1 year ago.
Because the service is provided in Wisconsin - that transaction is under THAT state jurisdiction and is regulated by Wisconsin state laws and regulations.
The first step - to verify if the service provided is subject to sales tax.
Sales and use tax applies to sales of tangible personal property, certain coins and stamps, certain leased property affixed to realty, certain digital goods, and specified services.
Specifically see following publication
page 33 where taxable services are listed.
If that service is taxable - you generally should pay sales tax.
If provided services are subject of sales tax - then...
Generally - you may only use exemption certificate if you purchase as a re=seller. In this case - you use an exemption certificate and do not pay sales tax to provider, but will charge sales tax from the purchaser and remit that amount to Wisconsin taxing authorities.
That is generally the purpose of the exemption certificate.
If these are taxable services which you purchase NOT to re-sell - you may not use an exemption certificate and must pay sales tax.
If provider doesn't charge sales tax - you will be responsible for use tax.
That is general rule - and would be used in Iowa - but there is a different sales tax law and some services taxable in Wisconsin might be not taxable in Iowa and opposite.