How to Fill Out Form AC 946: New York State Tax Exemption Certificate

Form AC 946 is New York State’s sales tax exemption certificate for employees of the state and its political subdivisions. Fill in the vendor’s name and address, your employing agency’s full legal name, your signature, your title, and the date, then hand the completed form to the vendor at the point of sale. The vendor removes state and local sales tax from the invoice. The form is a single-page PDF available from the Office of the State Comptroller.¹

Who Can Use the Form

AC 946 is reserved for employees of New York State or one of its political subdivisions who are making a purchase in the course of their official duties, paid for by the government entity. That covers state agencies and departments, counties, cities, towns, villages, fire districts, school districts, and public corporations chartered by the legislature.²

Nonprofit organizations cannot use AC 946, even those with their own sales tax exemption. A 501(c)(3) charity must use Form ST-119.1 instead. Picking the wrong form gives the vendor grounds to reject the exemption and may create problems in a later audit.³

Completing Each Field

The form is short, but every field has to be filled in. A blank or sloppy certificate is the easiest reason for a vendor to charge tax anyway. When you sign the form, you are personally certifying that the purchase is for official business and that the government entity is paying for it.¹

Name of Person or Firm Furnishing Services and/or Materials: the vendor’s business name as it appears on the invoice or storefront.
Address: the vendor’s address.
State Dept., Agency or Political Subdivision: your employing entity’s full legal name, such as “New York State Department of Transportation” or “Town of Colonie.” Avoid informal names and abbreviations, which can confuse the vendor’s records.
Signature of Employee: your own signature.
Title: your job title with the government entity.
Date: the date of the transaction, or the date you sign.

What the Exemption Does Not Cover

Two situations commonly trip people up. Meals you buy for yourself while traveling on official business are taxable, even if your agency reimburses you. The exemption applies to property and services bought for the entity’s use, not to personal expenses that happen alongside work.³

Hotel stays also fall outside AC 946. A government employee on official business claims the room occupancy exemption on Form ST-129, not this one.²

Giving the Certificate to the Vendor

Hand the completed AC 946 to the vendor at the point of sale, or send it digitally if you are ordering by phone or email. Check the invoice total before paying to confirm the tax came off.

AC 946 is not the only way to prove the entity is the buyer. A governmental purchase order or a government credit card also works as evidence that the entity, not you personally, is making the purchase, and the Tax Department has stated that a vendor needs only such evidence to forgo collecting tax.³

If You Forget the Form

You have 90 days from the date of purchase to deliver a completed certificate to the vendor. A certificate received within that window relieves the vendor of liability for not collecting the tax. Miss the deadline and both you and the vendor can be held liable.⁴

If the Vendor Refuses

Vendors are legally free to refuse an exemption certificate, even a correctly completed one. If that happens, the vendor must charge sales tax and you can apply for a refund by filing Form AU-11, Application for Credit or Refund of Sales or Use Tax, with the Department of Taxation and Finance.⁴

One Certificate Per Transaction

The form itself requires a separate certificate from each person claiming the exemption.¹ AC 946 is not designated for blanket use, so you cannot file one with a vendor to cover every future purchase.⁴ For repeat buys from the same supplier, a government purchase order or credit card is easier than a fresh form every time.

Keeping Copies

Both the vendor and your agency should hold on to a copy of each certificate. New York requires vendors to keep sales tax records, including exemption certificates, for at least three years from the due date of the return they relate to, or from the filing date if later, and to be able to tie each exempt sale to the specific certificate on file.⁵⁶ If an audit later finds the vendor’s copy missing or incomplete, the vendor can be assessed for uncollected tax and may push that dispute back to your agency. Your own file is the backstop.

Penalties for Misuse

Using AC 946 for a personal purchase, or for any transaction where the government entity is not genuinely the buyer, counts as issuing a false or fraudulent exemption certificate. Under Tax Law Section 1145(a)(5), the penalty is $50 for each misused certificate plus 100 percent of the tax that would have been owed, and it stacks on top of any other penalties in the Tax Law.⁷ The exposure grows quickly across multiple transactions.

1
Office of the New York State Comptroller. AC 946 – Tax Exemption Certificate
2
New York State Department of Taxation and Finance. A Guide to Sales Tax in New York State for Exempt Organizations
3
New York State Department of Taxation and Finance. Purchases and Sales by Governmental Entities
4
New York State Department of Taxation and Finance. Exemption Certificates for Sales Tax
5
Cornell Law Institute. 20 NYCRR 533.2 – Records to Be Kept
6
Department of Taxation and Finance. Recordkeeping Requirements for Sales Tax Vendors
7
Department of Taxation and Finance. Sales and Use Tax Penalties