Texas Resale Certificate: Form 01-339, Use, and Seller Duties

A Texas resale certificate is Form 01-339, a document a permitted business gives its supplier to buy inventory, raw materials, or components tax-free because those items will be resold to a customer. It is not a permit or license on its own. It is a written declaration that shifts the sales tax obligation forward to the eventual retail buyer, and it only works if the person issuing it holds an active Texas Sales and Use Tax Permit and genuinely intends to resell what they are buying.¹

Who Can Issue One

Any business with a valid Texas Sales and Use Tax Permit can issue a resale certificate. The controlling requirement is intent at the moment of purchase. Under Texas Tax Code § 151.151, the buyer must plan to sell, lease, or rent the item in the regular course of business, or incorporate it into a product or taxable service that will be sold.²

Qualifying purchases include inventory for a retail store, raw materials that become part of a finished product, and replacement parts installed as part of a taxable repair service.³

What you cannot do with a resale certificate is buy things your business will use itself. Office supplies, cleaning equipment, break-room furniture, and operational software are taxable purchases because you are the end consumer. This is where most audit trouble starts: a business buys something tax-free claiming resale, then quietly puts it into daily operations.

Getting the Sales and Use Tax Permit First

You need the underlying permit before you can issue any certificate. Apply through the Texas Comptroller’s eSystems portal online or by mailing Form AP-201. There is no application fee.⁴

The application asks for your business name, mailing address, entity type, and the names and Social Security numbers of owners, partners, or officers. A Federal Employer Identification Number appears on the form, but the Comptroller accepts applications submitted without one. You also describe your primary business activity, your expected monthly taxable sales, and the date you plan to begin selling.⁴

Once approved, you receive an 11-digit Texas taxpayer number. That number goes on every resale certificate you issue.

How to Fill Out and Present Form 01-339

The form asks for the purchaser’s name and address as shown on the permit, the 11-digit Texas Sales and Use Tax Permit number, and a description of the items being purchased for resale. It includes a certification statement that the items are being acquired for resale in the normal course of business. Give the completed form to your supplier before or at the time of purchase.¹

Single Purchase or Blanket Certificate

If you buy from the same supplier regularly and every purchase is for resale, you can issue a blanket resale certificate that covers all future purchases from that supplier. The certificate must state that all purchases from that supplier will be resold in the regular course of business, and the supplier may only accept a blanket form from a customer who buys exclusively for resale.⁵

If you sometimes buy items for your own use from the same supplier, pay tax on those individual transactions and reserve the blanket certificate for genuine resale purchases.

Does It Expire?

Texas resale certificates do not expire. A certificate on file with a supplier stays valid as long as the purchaser’s permit is active and the purchasing relationship continues. Sellers must keep accepted certificates for at least four years after the last sale covered by the certificate, and it is common for suppliers to request an updated form periodically.

When You End Up Using an Item You Bought for Resale

This is the situation that catches businesses off guard. You buy a case of products tax-free intending to resell them, then pull one out and use it in the business. At that point, you owe tax on the item you used. The Comptroller’s own example: if you bought brooms for resale and started using one to sweep your store, tax is owed on that broom.⁵

Texas Tax Code § 151.154 sets out the mechanics. You owe sales tax on the fair market rental value of the item for the period you use it, or you can choose to pay sales tax on the original purchase price instead. Report the amount on the “taxable purchases” line of your sales tax return. The only uses that do not trigger tax are retaining the item in inventory, demonstrating it to potential buyers, or displaying it for sale.²

Penalties for Misuse

Using a resale certificate to avoid sales tax on personal or business-consumption purchases is not just a billing correction. Under Tax Code § 151.707, it is a criminal offense, and the severity scales with the amount of tax avoided:

Less than $20 avoided: Class C misdemeanor
$20 to $199 avoided: Class B misdemeanor
$200 to $749 avoided: Class A misdemeanor
$750 to $19,999 avoided: third-degree felony
$20,000 or more avoided: second-degree felony

The charges apply to anyone who knowingly makes a false entry on a resale certificate, presents a certificate they know to be false, or deliberately conceals or tampers with one.⁶

On top of criminal exposure, the Comptroller assesses civil penalties on any unpaid tax. Between 1 and 30 days late brings a 5% penalty on the tax due. After 30 days, the penalty rises to 10%. If the tax is still unpaid after a formal notice, another 10% is added for a total of 20%. Interest also accrues starting 61 days after the due date, at 7.75% for 2026.⁷⁸

If You Are the Seller Accepting a Certificate

Accepting a resale certificate is not automatic. You are responsible for making sure the form is properly completed and that the buyer’s claim makes sense for their line of work. A hair salon handing you a resale certificate for industrial welding equipment should raise a red flag. The Comptroller’s guidance is direct: do not accept the certificate if you know or have reason to believe the property is being purchased for something other than resale.⁵

You can verify a buyer’s permit status through the Comptroller’s Sales Taxpayer Search tool, which shows whether a permit is active or inactive. Search by taxpayer ID, FEIN, business name and zip code, or the legal name of the entity.⁹ Thirty seconds of verification can save you from absorbing the tax liability later if the certificate turns out to be invalid.

Buyers From Outside Texas

Texas sellers can accept resale certificates from out-of-state buyers purchasing items for resale within the United States or Mexico. The out-of-state buyer does not need a Texas permit. The certificate must show the buyer’s sales tax permit or registration number from the state where they do business, along with a statement identifying that state. If the buyer is not required to hold a permit in their home state, the certificate must say so. The Texas seller is not responsible for determining whether an out-of-state retailer should hold a Texas permit.³

Records to Keep

Buyers and sellers both have record-keeping duties tied to resale certificates. Sellers must retain every certificate they accept along with the associated invoices, so they can prove why sales tax was not collected. Buyers should keep copies of every certificate they issue. The minimum retention period is four years, but the starting point matters. For general sales tax records, the clock runs from the date the record is created. For resale certificates specifically, keep them for at least four years after the last sale covered by the certificate.¹⁰ The distinction matters for blanket certificates, which can cover years of activity.

If the Comptroller is auditing your records, keep everything for the period under review until the audit is complete. If you appeal the findings or file a refund claim, hold the records until the matter is resolved.¹¹

1
Texas Comptroller of Public Accounts. Form 01-339 – Texas Sales and Use Tax Resale Certificate
2
State of Texas. Texas Tax Code 151.154 – Resale Certificate: Liability of Purchaser
3
Legal Information Institute. 34 Texas Administrative Code 3.285 – Resale Certificate; Sales for Resale
4
Texas Comptroller of Public Accounts. Texas Sales and Use Tax Frequently Asked Questions – Section: Obtaining a Sales Tax Permit
5
Texas Comptroller of Public Accounts. Texas Sales and Use Tax Frequently Asked Questions – Section: Resale Certificate
6
State of Texas. Texas Tax Code 151.707 – Resale or Exemption Certificate; Criminal Penalty
7
Texas Comptroller of Public Accounts. Penalties for Past Due Taxes
8
Texas Comptroller of Public Accounts. Interest Owed and Earned
9
Texas Comptroller of Public Accounts. Sales Taxpayer Search
10
Legal Information Institute. 34 Texas Administrative Code 3.281 – Records Required; Information Required – Section: Retention
11
Texas Comptroller of Public Accounts. Texas Sales and Use Tax Frequently Asked Questions – Section: How Long Do I Keep My Business Records