To fill out Form ST-121, New York’s Exempt Use Certificate, enter your business’s legal name, address, and Certificate of Authority number at the top; add the seller’s name and address; check the single letter in Part 1 or Part 2 that matches your exempt use; describe the property or service specifically enough that an auditor can connect it to that category; and sign and date the form. Then deliver the signed certificate to the seller within 90 days of receiving the property or service so the vendor can drop sales tax from the invoice. The blank form is a free fillable PDF on the Department of Taxation and Finance’s website.
What ST-121 Is For
ST-121 removes state and local sales tax from a purchase when the way your business will use the property or service is exempt under the Tax Law. Every retail sale in New York is presumed taxable until the buyer proves otherwise with a properly completed certificate, so without this form the vendor charges full tax at the combined state and local rate.1New York State Senate. New York Code TAX 1132 – Collection of Tax From Customer
ST-121 is specifically for exempt uses. If you’re buying inventory to resell, that’s Form ST-120. If you’re purchasing on behalf of an exempt organization such as a nonprofit, that’s Form ST-119.1. Don’t use ST-121 for those situations.
Part 1 of ST-121 lists exempt tangible property. The categories are:2New York State Department of Taxation and Finance. New York State and Local Sales and Use Tax Exempt Use Certificate
- A — Machinery, equipment, parts, tools, and supplies used directly and predominantly in manufacturing tangible personal property for sale, or in generating gas, electricity, refrigeration, or steam for sale
- B — Tangible personal property used in producing a film for sale
- C — Property used in providing telecommunications or internet access services for sale
- D — Machinery and equipment used by television or radio broadcasters in production or transmission
- E — Gas or electricity used to operate a pipeline, transmission line, or distribution line
- F — Fuel, gas, electricity, refrigeration, or steam used in producing tangible personal property or film for sale
- G — Fuel, gas, electricity, refrigeration, or steam used in generating gas, electricity, refrigeration, or steam for sale
Part 2 covers services performed on the qualifying property from Part 1, most commonly installing, repairing, or servicing production equipment (item H) and fabricating, processing, or printing for film or broadcasting (item I). Part 2 also lists narrower categories including pollution control equipment, commercial fishing vessels, cargo-handling machinery at qualified New York City marine terminals, and aircraft maintenance property. A catch-all category (item U) lets you claim any other exempt use, but only if you describe it and cite the specific Tax Law section that authorizes the exemption.
For categories A and D, “directly and predominantly” means the property must be used more than 50 percent of the time in the qualifying activity.3New York State Senate. New York Code TAX 1115 – Exemptions From Sales and Use Taxes A CNC mill running production jobs 70 percent of the time qualifies. The same machine running production 40 percent of the time and in-house prototyping the rest does not.
Filling In the Form, Section by Section
Download the current fillable PDF from the Tax Department’s exemption documents page. The form is one page, but each section has to be right. An incomplete or inconsistent certificate leaves the seller exposed during an audit, and experienced vendors will refuse a sloppy one.
Purchaser and Seller Information
Enter your business’s legal name and address exactly as they appear on your Certificate of Authority. Add your Certificate of Authority identification number — the number the Tax Department assigned when you registered as a vendor.4New York State Department of Taxation and Finance. How to Register for New York State Sales Tax If you’re not required to be registered because you only make exempt sales, the form asks you to explain why and provide an alternative identifier. Then enter the seller’s name and address in the block below.
Selecting the Exempt Use Category
Check only the letter that genuinely applies. Checking extra boxes “just in case” draws audit attention and can taint the whole certificate. If your purchase falls under item U, write a clear description of the exempt use and cite the specific Tax Law section that authorizes it. “Business use” is not a description, and it will not protect you.
Describing the Property or Service
Be specific enough that someone reading the certificate three years later can match the item to the category you checked. “One Haas VF-2 vertical machining center for production of metal components for sale” is the right level of detail. “Equipment” is not.
Signature and Date
An authorized representative of the purchasing business must sign and date the form. Missing signatures are the single most common reason vendors reject certificates. The Tax Department accepts electronic versions of the certificate, including electronic signatures, so long as the digital document is a complete replica of the official form.5New York State Department of Taxation and Finance. Exemption Certificates for Sales Tax
Setting It Up as a Blanket Certificate
You don’t need a fresh ST-121 for every purchase from the same seller. The form can function as a blanket certificate covering all subsequent purchases of the same general type of property or service. Each later invoice must show your name, address, and Certificate of Authority number, but no new form is needed.2New York State Department of Taxation and Finance. New York State and Local Sales and Use Tax Exempt Use Certificate
A blanket certificate stays in effect until you give the seller written notice revoking it, the seller learns the certificate is false, or the Tax Department notifies the seller that you can no longer make exempt purchases. There is no automatic expiration. That’s convenient for ongoing supplier relationships, but it also means the certificate has to be revisited if what you’re buying from that vendor changes. A blanket certificate set up for production equipment does not cover office furniture or breakroom supplies routed through the same vendor later.
Getting the Certificate to the Seller
Deliver the completed, signed ST-121 to the vendor within 90 days after the property is delivered or the service is performed.1New York State Senate. New York Code TAX 1132 – Collection of Tax From Customer Hand it over at the time of sale when possible. Waiting until day 89 is legal but risky, because if the seller has already remitted the tax, unwinding it becomes your problem.
Miss the 90-day window and the sale is treated as taxable. You’d then have to pay the tax and apply separately for a refund. A certificate that arrives within 90 days but has a curable deficiency, such as a missing Certificate of Authority number, can still be corrected. Once the deficiency is cured, the certificate is treated as if it had met the requirements from the start.1New York State Senate. New York Code TAX 1132 – Collection of Tax From Customer
Records You Need to Keep
Keep copies of every completed ST-121 and the related invoices for at least three years after the return covering that transaction is filed.6New York State Department of Taxation and Finance. Recordkeeping for Businesses That matches the general three-year window the Tax Department has to audit sales tax returns.7New York State Senate. New York Code TAX 1147 – Notices and Limitations of Time If you filed a fraudulent certificate or never filed a return at all, there is no time limit and the state can assess the tax at any point.
Organize the records so each exempt purchase can be matched to the certificate that supports it. During an audit, the examiner pulls invoices and looks for the corresponding ST-121. If you can’t produce one, the sale gets reclassified as taxable and you owe the tax plus penalties.
If You Already Paid Tax on an Exempt Purchase
Paid sales tax on something that should have been exempt? Apply for a refund using Form AU-11, Application for Credit or Refund of Sales or Use Tax. You can submit it through the Tax Department’s Sales Tax Web File system if your business has an Online Services account.8New York State Department of Taxation and Finance. How to Apply for a Refund of Sales and Use Tax
The filing deadline is the later of three years from the date the tax was payable to the Tax Department or two years from the date you actually paid it. Include the completed AU-11 with a copy of the ST-121, the invoice showing tax was charged, and a written explanation of why the purchase qualifies for the exemption.
Penalties for Misusing the Form
Issuing a false or fraudulent ST-121 with intent to evade tax carries a civil penalty of $50 per misused document plus 100 percent of the tax that should have been collected.9New York State Department of Taxation and Finance. Sales and Use Tax Penalties On a $100,000 equipment purchase in a jurisdiction with an 8 percent combined rate, an $8,000 tax savings becomes a $16,050 liability. Willfully filing a fraudulent tax document is also a tax fraud act under Tax Law Section 1801 and can carry criminal charges.10New York State Senate. New York Tax Law 1801 – Tax Fraud Acts
Most businesses that get caught aren’t committing outright fraud. They’re using a blanket certificate carelessly — a certificate set up for production equipment, then used for non-qualifying purchases from the same vendor over time. An auditor who finds non-qualifying items covered by a blanket certificate assesses the tax on every one of them, and the penalties compound quickly across dozens of invoices.