New York — Sales & Use Tax

New York imposes a statewide sales tax at a rate of 4% on receipts from every retail sale of tangible personal property, unless otherwise exempted. This base rate applies uniformly across all counties and does not vary by location.

Source: N.Y. Tax Law § 1105

The 4% state rate serves as the foundation upon which local jurisdictions may impose additional sales taxes. Counties and cities are authorized to add their own rates on top of the state base, resulting in combined rates that vary by location throughout the state. Additionally, localities within the Metropolitan Commuter Transportation District (MCTD)—which includes New York City and several surrounding counties—are subject to an additional 0.375% surcharge, bringing the effective state-level rate in those areas to 4.375% before local taxes are added.

Source: N.Y. Tax Law § 1109

New York imposes sales tax collection obligations on out-of-state sellers who meet the state's economic nexus thresholds, even when the seller has no physical presence in New York.

Source: N.Y. Tax Law § 1101(b)(8)(i)(E)

## Thresholds

A business is presumed to be "regularly or systematically soliciting business" in New York—and therefore required to register and collect sales tax—if, during the immediately preceding four sales tax quarters:

• The cumulative total of gross receipts from sales of tangible personal property delivered into New York exceeds $500,000, AND
• The business made more than 100 sales of tangible personal property delivered into the state.

Both conditions must be met. A business that meets the gross receipts threshold but has not made more than 100 transactions is not required to register for sales tax under the economic nexus rule.

Source: N.Y. Tax Law § 1101(b)(8)(iv) Source: Registration requirement for businesses with no physical presence in New York State

## Measurement Period

The lookback period is the immediately preceding four sales tax quarters. New York's sales tax quarters end on the last day of February, May, August, and November. After the conclusion of each quarter, businesses should review their New York sales to determine whether they have met both thresholds.

Source: Registration requirement for businesses with no physical presence in New York State

## What Counts Toward the Thresholds

"Sales transactions" means each invoice, sales slip, contract, or other memorandum of sale issued for the sale of tangible personal property delivered into New York, whether taxable or exempt, including sales for resale. Both taxable and non-taxable sales count toward the $500,000 gross receipts threshold and the 100-transaction threshold.

Source: Registration requirement for businesses with no physical presence in New York State

Marketplace sales facilitated by a third-party platform are included in the seller's threshold calculation, even when the marketplace facilitator collects and remits tax on those sales.

Source: Registration requirement for businesses with no physical presence in New York State

## Registration and Collection Timing

If a business meets both thresholds, it must file a Certificate of Authority within 30 days after the day it met the thresholds and begin to collect tax 20 days after filing the certificate.

Source: Registration requirement for businesses with no physical presence in New York State

## Effective Date

New York's economic nexus provisions became effective on June 21, 2018, the date of the United States Supreme Court decision in South Dakota v. Wayfair. The dollar threshold was initially $300,000, but was raised to $500,000 on June 24, 2019, retroactive to June 21, 2018.

Source: TSB-M-19(4)S, New York State Department of Taxation and Finance

The above threshold and rule structure is confirmed as accurate by the New York DTF as of its last publication update on May 30, 2025; no statutory or regulatory changes have affected these provisions since the last review.

Source: Registration requirement for businesses with no physical presence in New York State

New York imposes its 4% sales tax on receipts from: (a) every retail sale of tangible personal property; (b) sales of gas, electricity, refrigeration, steam, and telephone and telegraph services (except for resale); (c) enumerated services, including information services, protective and detective services, interior decorating and design, installation, maintenance, servicing, and repair of tangible personal property, and certain other listed services; (d) food and drink sold by restaurants, taverns, and caterers; (e) hotel and motel room rentals; and (f) admission charges to places of amusement. Tangible personal property is taxable unless specifically exempt; services are taxable only if enumerated in the statute.

Source: N.Y. Tax Law § 1105

In New York, a marketplace provider’s obligation to collect and remit sales tax applies solely to sales of tangible personal property, even if some services are taxable under Tax Law § 1105. Taxable services—such as information services, installation charges, or other enumerated services—are not within the marketplace provider collection regime unless they qualify as tangible personal property.

Statutory Scope Tax Law § 1101(e)(1) defines a “marketplace provider” specifically as a person who, under agreement with a marketplace seller, facilitates sales of tangible personal property. This includes providing the forum (e.g., online platform, catalog) and collecting customer receipts on behalf of the seller. The statute characterizes rentals of passenger cars as not being sales of tangible personal property—i.e., they are expressly excluded from the marketplace provider definition.

Agency Guidance The New York State Department of Taxation and Finance official guidance is unequivocal: marketplace providers are responsible only for sales of tangible personal property. The guidance explicitly states that “hotel occupancy, services and restaurant food are not considered tangible personal property,” and thus are not subject to the marketplace provider collection requirement.

Seller Responsibility for Taxable Services When a marketplace sale involves taxable services (e.g., software-as-a-service, installation, information services), those services do not trigger collection obligations on the part of the marketplace provider. The marketplace seller remains responsible for collecting, reporting, and remitting tax under the general rules for taxable services in Tax Law § 1105.

No Special Sourcing or Reporting Requirements for Services Because marketplace providers are not obligated to collect on services, there are no special sourcing, reporting, or certificate-of-collection rules for services transacted via marketplace platforms. Taxable services must be treated by the seller using the standard service sourcing rules under Tax Law § 1105 and its implementing regulations.

Summary

• Marketplace provider responsibility extends only to tangible personal property (including off-the-shelf software).
• Taxable services are excluded, and the collection duty remains with the marketplace seller.
• No special marketplace-specific sourcing or reporting rules apply to services.

Source: N.Y. Tax Law § 1101(e)(1) Source: NY DTF official guidance

Review status: Not yet human confirmed

Sales of tangible personal property for resale are exempt from New York sales tax. A sale is not a "retail sale" if the property is purchased for resale as such or as a physical component part of tangible personal property. To claim the exemption, the purchaser must provide the seller with a properly completed resale certificate (Form ST-120) within 90 days after delivery of the property. The certificate must include the purchaser's name, address, and Certificate of Authority number. A vendor who accepts a resale certificate in good faith is not required to collect tax, even if the certificate later proves invalid.

Source: N.Y. Tax Law § 1101(b)(4)(i) Source: N.Y. Tax Law § 1132(c) Source: Tax Bulletin TB-ST-240

When the New York State Department of Taxation and Finance (Department) concludes an audit or otherwise determines that additional sales or use tax is due, it issues a Notice of Determination to the taxpayer. The Notice of Determination specifies the amount of tax, penalties, and interest assessed for the tax periods examined, identifies the legal basis for the assessment, and provides the taxpayer with formal protest rights.

90-day protest deadline A taxpayer has ninety (90) days from the mailing date of the Notice of Determination to file a written protest. This deadline is jurisdictional; the Department and the Division of Tax Appeals lack authority to accept a late-filed protest, even by one day. The 90-day period runs from the date the notice is mailed by the Department, not the date the taxpayer receives it. Missing this deadline renders the assessment final and immediately enforceable through warrant, levy, or other collection action.

Two protest paths New York law offers taxpayers two mutually exclusive protest routes, both governed by Tax Law Article 40. A taxpayer may either:

1. Request a conciliation conference with the Bureau of Conciliation and Mediation Services (BCMS) by filing Form CMS-1, Request for Conciliation Conference, within 90 days of the notice mailing date. BCMS is an independent bureau within the Department that reports directly to the Commissioner. Conciliation conferences are informal settlement proceedings conducted by a conferee who has broader settlement authority than the auditor. Over 90% of protests are resolved at this stage. The taxpayer may request the conference online through the Department's Online Services portal, by mail, or by fax. If conciliation does not resolve the matter, the conferee issues a Conciliation Order, which the taxpayer may then appeal to the Division of Tax Appeals by filing a petition within 90 days of the issuance of the Conciliation Order.

1. File a petition directly with the Division of Tax Appeals (DTA) within 90 days of the notice mailing date, bypassing BCMS entirely. The DTA is a separate, independent adjudicatory body that conducts formal administrative hearings before Administrative Law Judges (ALJs). This route is adversarial and resembles litigation; discovery, testimony, and evidentiary rules apply. Taxpayers who choose this path forgo the opportunity for an informal settlement conference with BCMS.

The two paths are mutually exclusive: filing a BCMS request precludes filing a direct DTA petition during the initial 90-day window, and vice versa. Once a taxpayer selects one path, the other is unavailable unless and until the chosen path is exhausted.

What the protest filing must contain A BCMS request (Form CMS-1) must identify the notice being protested, state the tax type and periods, provide the taxpayer's contact information, and briefly explain why the taxpayer disagrees with the determination. A petition to the DTA must comply with the requirements of 20 NYCRR § 3000.3: it must be in writing, set forth in separately numbered paragraphs the facts and legal grounds supporting the taxpayer's position, and provide "fair notice of the matters in controversy." The petition must be signed and include the taxpayer's address.

Penalty and interest continue to accrue Filing a protest does not stop the accrual of interest or penalties on the assessed amount. Interest continues to run during the entire appeals process. A taxpayer may pay the assessment in full at any time to stop further accrual and still continue the protest; payment is not considered an admission of liability and does not waive appeal rights.

Source: NY Tax Law § 170(3-a), Form CMS-1, Request for Conciliation Conference, Protest a department notice

New York's administrative appeals process for sales and use tax disputes is governed by Tax Law Article 40, which establishes a two-tier independent adjudication system separate from the Department of Taxation and Finance. The process begins at the Division of Tax Appeals (DTA) and may proceed to the Tax Appeals Tribunal; judicial review follows only after exhausting these administrative remedies.

Division of Tax Appeals (DTA) — first tier The Division of Tax Appeals is an independent state agency that conducts formal administrative hearings on tax controversies. It is governed by Tax Law §§ 2000–2022. When a taxpayer files a petition challenging a Notice of Determination (either directly or after an unsuccessful conciliation conference), the matter is assigned to an Administrative Law Judge (ALJ) within the DTA. The ALJ conducts a hearing in which both the taxpayer and the Department's Division of Taxation present evidence, examine witnesses, and submit legal arguments. The proceeding resembles a bench trial: discovery is available under 20 NYCRR Part 3000, testimony is under oath, and the New York rules of evidence apply in modified form.

After the hearing, the ALJ issues a written Determination analyzing the facts, applying the law, and sustaining, modifying, or canceling the Department's assessment. The Determination is mailed to both parties by certified or registered mail. Either party may then file an Exception to the ALJ's Determination with the Tax Appeals Tribunal within 30 days of the mailing date; if no Exception is filed, the ALJ's Determination becomes the final administrative determination.

Tax Appeals Tribunal — second tier The Tax Appeals Tribunal is the final administrative appellate body for New York State tax matters. It is established under Tax Law §§ 2000–2006 and consists of three members appointed by the Governor with the advice and consent of the Senate. The Tribunal reviews the ALJ's Determination de novo on the law but defers to the ALJ's factual findings unless they are not supported by substantial evidence in the record.

When an Exception is filed, the Tribunal may affirm, reverse, or modify the ALJ's Determination, or remand the matter for further proceedings. The Tribunal issues a written Decision explaining its reasoning. The Tribunal's Decision is the final determination of the administrative process and is binding on both the taxpayer and the Department unless appealed to the courts.

Judicial review — Appellate Division A taxpayer (or the Department) dissatisfied with the Tribunal's Decision may seek judicial review by filing a proceeding under CPLR Article 78 in the Appellate Division of the New York Supreme Court, Third Judicial Department, which has exclusive subject-matter jurisdiction over appeals from the Tax Appeals Tribunal. The Article 78 proceeding must be filed within four months of the date the Tribunal's Decision is mailed. Judicial review is limited to whether the Tribunal's determination was affected by an error of law, was arbitrary and capricious, or was not supported by substantial evidence.

If the Appellate Division's decision is adverse, further review may be sought in the New York Court of Appeals (the state's highest court), but only by leave of the Appellate Division or the Court of Appeals itself.

Burden of proof Under Tax Law § 689(e), the burden of proof in a proceeding before the DTA or the Tribunal rests on the petitioner (typically the taxpayer) on all issues except fraud, transferee liability, and certain penalty assertions. The taxpayer must prove by a preponderance of the evidence that the Department's determination is erroneous.

Small claims alternative A taxpayer may elect to proceed in the DTA's Small Claims unit if the amount of sales or compensating use tax in dispute (exclusive of penalties and interest) does not exceed $40,000 per 12-month period in question. For all other taxes, the small claims limit is $20,000 per 12-month period. These thresholds are established by regulation and are confirmed on the Division of Tax Appeals About page. Small Claims proceedings are more informal and faster, but the determination is not appealable; it becomes final 30 days after issuance and may not be reviewed by the Tribunal or the courts except in cases of fraud or jurisdictional defect.

Source: Division of Tax Appeals – About

New York imposes strict time limits on the Department of Taxation and Finance's authority to assess additional sales and use tax, and on a taxpayer's right to claim a refund of overpaid tax. Both limitations are codified in Tax Law Article 28 (sales and use tax) and incorporate rules from Tax Law Article 27 (general administrative provisions).

Three-year general rule for assessments Under Tax Law § 1147(b), the Department may not assess additional sales or use tax more than three years after the date a return was filed. If a taxpayer files a return before the statutory due date, the return is deemed filed on the due date, so early filing does not shorten the limitations period. For example, if a quarterly sales tax return for the period ending March 31, 2023, was due on April 20, 2023, but the taxpayer filed it on April 1, 2023, the three-year limitations period begins on April 20, 2023, and expires on April 20, 2026.

Exceptions extending or eliminating the assessment period The three-year rule does not apply—and the Department may assess tax at any time—in the following circumstances:

• No return filed: If the taxpayer fails to file a required return, there is no statute of limitations; the Department may assess at any time.
• False or fraudulent return with intent to evade tax: If the Department establishes that the taxpayer filed a false or fraudulent return with the specific intent to evade tax, the limitations period does not apply. The Department bears the burden of proving fraud.
• Consent to extend: The taxpayer and the Department may agree in writing to extend the limitations period before it expires. Extensions are common when an audit is ongoing and the statute is about to expire. The extension must be in writing and signed by both parties; the extended period may be further extended by subsequent written agreements.

The Department frequently requests consent extensions during audits. A taxpayer is not obligated to consent and may instead allow the statute to expire, but refusal may result in the Department issuing a protective assessment based on incomplete information.

Refund claims: three-year lookback A taxpayer seeking a refund or credit of overpaid sales or use tax must file an application for refund under Tax Law § 1139 within three years from the time the return was filed, or two years from the time the tax was paid, whichever expires later. If a taxpayer files a protective refund claim while an assessment period is still open (e.g., during an audit), the refund statute is suspended until six months after the Department issues a final assessment or determination.

The three-year/two-year refund limitation is strictly enforced. A refund claim filed even one day late is barred. The Department has no discretion to waive this deadline.

20-year collection statute Once an assessment becomes final (either because the taxpayer did not protest, or because all appeals have been exhausted), New York imposes a separate 20-year limitation on collection. Under Tax Law § 174-b, a tax liability is extinguished 20 years from the first date a warrant could have been filed by the Commissioner, regardless of whether a warrant is actually filed. This collection statute runs independently of the assessment statute and cannot be extended by consent.

Coordination with voluntary disclosure When a taxpayer enters into a voluntary disclosure agreement (VDA) with the Department, the agreement typically limits the lookback period for unpaid tax to a negotiated number of years (commonly three years), even if the underlying assessment statute would permit a longer lookback. VDAs are discussed in detail in the voluntary-disclosure section of this guide.

Source: N.Y. Tax Law § 1147, N.Y. Tax Law § 1139, N.Y. Tax Law § 174-b

New York provides two formal avenues to clarify, resolve, or obtain guidance regarding state sales and use tax obligations: the Voluntary Disclosure and Compliance Program (VDA) for resolving past-due liabilities not yet under audit, and the advisory opinion process for official guidance on future or uncertain transactions.

Voluntary Disclosure and Compliance Program (VDA) The New York State Department of Taxation and Finance administers an ongoing voluntary disclosure program authorized by N.Y. Tax Law § 1700 and further described in TSB-M-10(4)S and Department publications. The VDA program allows a taxpayer with unreported, underreported, or unpaid sales and use tax liability to come forward, pay outstanding tax and interest, register if required, and obtain waiver of penalties otherwise applicable to those liabilities.

Eligibility To be eligible, a taxpayer:

• Must not be under audit or criminal investigation by the Department for the tax and periods at issue.
• Must not already have been contacted by the Department concerning the same liability (audit notice, inquiry letter, subpoena, etc.).
• May apply even if the noncompliance was willful or involved fraud, though the Department retains discretion to examine facts and may deny participation in certain egregious cases. There is no categorical exclusion for fraud or willfulness in the statute or current guidance.

Look-back period The Department’s standard policy limits the look-back period for most sales and use tax VDAs to three years prior to the VDA application, but this is not a statutory right and exceptions exist:

• The look-back may be extended up to six years in certain circumstances (e.g., significant underreporting, fraud, or where trust fund taxes were collected and not remitted).
• There is no guarantee of a three-year cap; the actual look-back applicable to each agreement is established by negotiation with the Department, subject to the facts of the case and Department policy at the time of application.
• See official guidance for current exceptions.

Anonymous application option New York allows initial VDA applications to be made anonymously through a representative. Taxpayer identity is disclosed only after tentative acceptance by the Department and agreement on key terms, as set forth in TSB-M-10(4)S and the Department's VDA application procedures.

Penalty waiver and payment terms

• If the VDA is accepted and fully complied with, all civil penalties are waived for the covered periods and liabilities. By policy, interest must still be paid in full from the original due date. Penalty waiver does not extend to tax or interest due, nor does it immunize for periods outside the VDA agreement.
• Installment payments for interest and tax may be permitted at the Department’s discretion for demonstrated financial hardship, upon substantiation.

No waiver of statute-of-limitations defense Entering into a VDA does not by itself waive any applicable statute-of-limitations defense for periods outside the agreed look-back period. The agreement will specify the covered periods.

How to apply Applications are submitted to the Department’s Voluntary Disclosure Unit either directly or via representative. Required information includes tax type, business summary, periods and estimated liability, and a statement of the reason for noncompliance. Department review precedes any formal agreement.

Source:

• N.Y. Tax Law § 1700
• TSB-M-10(4)S, Voluntary Disclosure and Compliance Program
• Voluntary Disclosure—NY DTF

Advisory opinions—official taxpayer guidance Taxpayers may formally request advisory opinions from the Department under N.Y. Tax Law § 171(28), to obtain official written guidance on the application of sales and use tax to a proposed or factual transaction.

• Advisory opinions are binding on the Department as to the requesting taxpayer and the specific facts presented, but are not precedential for other taxpayers, and may be superseded by subsequent law or policy.
• Matters already under audit, appeal, or litigation are not eligible for advisory opinions. The Department will not provide opinions on purely hypothetical or factual disputes. Questions must be presented with specificity, including all facts, statutory citation, and the question to be answered.
• Requests are submitted in writing to the Department’s Office of Counsel. There is no filing fee. Responses are typically public, published with identifying details redacted as TSB-A advisory opinions on the Department's website.

Source:

• N.Y. Tax Law § 171(28)
• Request an advisory opinion (NY DTF)

Material update: As of June 2024, statutory citation for the VDA program is N.Y. Tax Law § 1700 (not § 171-a), and willful or even fraudulent noncompliance does not categorically preclude VDA eligibility, though Department discretion applies.

New York State sales tax vendors are assigned a filing frequency—quarterly, part-quarterly (monthly and quarterly combined), or annual—based on the Department of Taxation and Finance's review of their taxable receipts and business profile. Vendors are notified of their assigned frequency when they register and may be reassigned if business activity changes. These assignments and requirements are specified in Tax Bulletin TB-ST-275 and supported by the official return forms and instructions.

Quarterly Filing (Most Vendors)

• Periods: Four standard quarterly periods:
• December 1 – last day of February (due March 20)
• March 1 – May 31 (due June 20)
• June 1 – August 31 (due September 20)
• September 1 – November 30 (due December 20)
• Due Date: Each quarterly return and tax payment is due by the 20th day of the month following the end of the quarter. If the 20th falls on a weekend or legal holiday, the due date is the next business day.

Part-Quarterly (Monthly/Prepaid) Filing

• Certain vendors, including those with substantial sales volume or motor fuel/distributor activity (as specifically identified by the Department), must file monthly returns for the first two months of each quarter (Form ST-809, due the 20th of the following month for each), and a quarterly reconciliation (Form ST-810, due the 20th after the quarter ends). Designation is based on the Department's assessment of the prior year’s activity and criteria set forth in TB-ST-275.

Annual Filing

• Some vendors with low sales volume or seasonal operation may be permitted to file annually; eligibility and criteria are determined by the Department and described in TB-ST-275. The annual period is March 1 to the last day of February, due March 20. The specific thresholds for annual filing are not published in the bulletin and must be confirmed via the Department’s written assignment.

PrompTax (Accelerated Electronic Filing)

• Vendors who the Department notifies as qualifying for mandated electronic filing (based on factors such as sales, tax liability, or business type) may be required to participate in the PrompTax program. Due dates and remit schedules for PrompTax participants are explained in Department guidance and can vary; details for each business are provided by written notice from the Department.

Changes to Filing Frequency

• The Department reviews filing frequencies at least annually and will notify vendors in writing if their status changes. Vendors are responsible for following the assigned schedule unless and until a new assignment is communicated.

All deadlines, filing periods, and assignment rules are governed by Tax Bulletin TB-ST-275, Form ST-809/810 series, and the PrompTax guidance.

Source: Tax Bulletin TB-ST-275 (NY DTF) Source: Form ST-809 Instructions Source: Monthly Filer Forms ST-809 Series (NY DTF) Source: PrompTax - Filing Sales Tax Returns (NY DTF)

Direct answer: A business owes New York State use tax when it purchases tangible personal property or taxable services without paying New York sales tax and either (a) uses, stores, or consumes the item in New York, or (b) withdraws property from resale inventory for its own use. Use tax is self-assessed and reported on the same return as sales tax (Form ST-100 series) or, in some instances, on a separate use tax form such as Form ST-130 for those not registered for sales tax.

Why: New York imposes a compensating use tax under N.Y. Tax Law § 1110 on property and taxable services used in New York where sales tax was not charged, including items purchased out-of-state or online. The statute applies whether the property was purchased for use, storage, consumption, or withdrawn from inventory previously bought for resale. If a business claims the resale exemption for items later used (not resold), it must accrue and pay use tax on the cost of those items. The DOR bulletin TB-ST-910 details examples: office supplies ordered out-of-state, promotional items pulled from inventory, or equipment shipped from another state for in-state use—all trigger use tax unless another exemption applies. The obligation does not arise if New York sales tax (or equivalent) was already paid to the vendor or the purchase qualifies for another New York exemption.

Source support:

• N.Y. Tax Law § 1110 (imposing use tax)
• Tax Bulletin TB-ST-910, "Use Tax for Businesses" (detailed guidance on triggers, reporting, and forms)

Caution / review status: Not yet human confirmed. The definition and mechanics above strictly follow statute and DOR official bulletin; edge-case exemption interactions (such as drop shipments or bundled transactions) should be separately confirmed for a given scenario.

Source: N.Y. Tax Law § 1110 Source: Tax Bulletin TB-ST-910

June 2026 update: Prior secondary citation to 20 NYCRR § 525.2 on the NY DOS website has been removed because the referenced official state link is no longer available and no live, primary-source replacement was identified. All substantive content remains unchanged; statutory and DOR authority remain current as of July 2026.

New York State imposes a 4% statewide sales tax, but most counties and some cities levy an additional local sales tax. The combined rate that applies to a sale—including for New York City—is determined using a strict destination-based sourcing rule for tangible personal property. This means:

Destination-Based Sourcing (Tangible Personal Property): The local rate is set by where the buyer takes delivery or possession of the property, not the seller’s place of business. For shipped goods, this is the delivery address given by the buyer (regardless of shipment origin). For in-store pickup, the pickup location sets the local rate. Neither the seller’s address nor the location of the contracting or billing controls the local rate. New York Department of Taxation and Finance states: “the jurisdiction where delivery occurs — whether that’s your business location or another address designated by the customer — determines the local rate.”

Services: The DTF bulletins primarily address tangible personal property. While many taxable services (e.g., hotel occupancy, restaurant food) are sourced to the location of performance or use, the bulletins do not provide a comprehensive rule for all services. If sourcing for a specific service is not addressed in DTF guidance, consult the applicable statutes or reach out to the Department for clarification.

MCTD Surcharge: If the delivery destination is within the Metropolitan Commuter Transportation District (MCTD)—which includes New York City and certain surrounding counties—an extra 0.375% state surcharge applies, layered onto the combined sales tax. This surcharge is applied specifically when the sale is delivered, or service rendered, within the MCTD area. DTF’s bulletin directs vendors to use the MCTD rate “for deliveries within that district.”

Special Rule: Motor Vehicles, Trailers, Boats, Aircraft: For motor vehicles, trailers, vessels, and aircraft delivered or registered in New York, the local tax rate is determined by the purchaser’s place of residence (or business/address if for business use), not the delivery location. As Publication 750 puts it: "the local tax is computed based on the rates in effect where the purchaser is a resident, regardless of where the delivery occurred."

Rates and boundaries for local rates—including special local city taxes and the effective dates for rate changes—can change frequently. The Department publishes current rates online and in updated bulletins.

Source: Tax Bulletin TB‑ST‑825, "Sales Tax Rates, Additional Sales Taxes, and Fees" Source: Publication 750, A Guide to Sales Tax in New York State

New York sales tax law distinguishes between tangible personal property (TPP), enumerated taxable services (such as information services and software), and exempt intangibles. As of June 2026, the taxability of newly emerged digital products like bare cloud storage, blockchain-based digital goods (such as NFTs), and AI-inferencing/processing services depends on their legal classification under Article 28 of the Tax Law and Department guidance.

Cloud Storage Services (Bare Storage): New York statutes, regulations, and Department of Taxation and Finance guidance do not directly address sales tax application to bare cloud storage services where the customer only rents storage capacity and does not use or control prewritten software. In existing Tax Appeals Tribunal and advisory opinions, remote access to prewritten software (SaaS) is taxable when the customer 'uses or controls' the software (see N.Y. Tax Law § 1105(a) and TSB-A-09(19)S, where remote trading software access was held taxable as SaaS). However, when a service simply rents data capacity with no attendant use of taxably classified software, the transaction is generally viewed as a nontaxable intangible or service. No Department advisory opinion or tribunal decision has classified bare cloud storage as taxable TPP or as a "furnishing of information" service under N.Y. Tax Law § 1105(c)(1). Unable to confirm as of 2026-07-06.

NFTs and Blockchain-based Digital Goods: Neither N.Y. Tax Law Article 28 nor Department guidance as of June 2026 specifically addresses the sales tax treatment of the sale or transfer of NFTs (non-fungible tokens) or other blockchain-based digital assets. NFTs typically confer ownership of a unique digital item represented on a blockchain. Department publications and TSB-As do not list NFTs among taxable digital products and do not characterize them as tangible personal property. There is no binding authority clarifying whether an NFT constitutes taxable TPP or a taxable information service. Unable to confirm as of 2026-07-06.

AI-Inferencing and Machine Learning Services: No New York statute, regulation, Tribunal decision, or official Department publication has addressed the sales taxability of cloud-hosted or remote AI-inferencing services (i.e., services analyzing, creating, or rendering content on demand via artificial intelligence or machine learning engines). The most analogous guidance—covering access to analytical software or information services—suggests fact-specific classification, but none addresses AI services specifically. Unable to confirm as of 2026-07-06.

In summary: Bare cloud storage, NFTs, and AI-based digital services are not expressly classified as taxable tangible personal property or enumerated information services in New York as of June 2026. Practitioners should monitor for advisory opinions or updated Department guidance, as emerging technologies often prompt subsequent legal action or publication.

Source: N.Y. Tax Law § 1105; TSB-A-09(19)S

Direct answer: A New York sales tax vendor may be held liable for uncollected sales tax if it accepts an incomplete, defective, or improperly used resale or exemption certificate, or if the purchaser later uses the purchased property in a taxable manner without tax being collected. However, there is a statutory and regulatory safe harbor: a vendor is protected from liability if it obtains a properly completed exemption certificate within 90 days of delivery and accepts it in good faith.

Why: Under N.Y. Tax Law § 1132(c)(1) and regulation 20 NYCRR § 532.4, a vendor does not have to collect sales tax if it receives a fully completed exemption certificate (including resale certificates, Form ST-120) from the purchaser within 90 days of the date of delivery. The certificate must show all required fields, be signed, and state the basis of the exemption. If the vendor receives the certificate late, or if the certificate is defective—missing information, not signed, or otherwise incomplete—the Department may hold the vendor liable unless the vendor proves the sale was exempt "by other means." The Department will disallow the exemption if there is any reason to know the certificate is false or if it is not "accepted in good faith."

If property sold on a resale (or other exempt) basis is later withdrawn from inventory for the purchaser’s own use, the purchaser—not the vendor—owes use tax. However, if the original sale was not adequately documented by a valid certificate, the liability can revert to the vendor. Vendors who accept obviously incorrect certificates or do not keep complete records cannot claim safe harbor and may be subject to assessment, interest, and penalty for uncollected tax.

Source support:

• N.Y. Tax Law § 1132(c)(1) (vendor liability and certificate requirements)
• 20 NYCRR § 532.4 (acceptance of exemption certificates; good faith standard)
• NY DTF Tax Bulletin TB-ST-240 (best practices, documentation and audit defense)

Best practices to avoid liability:

• Always obtain and retain a properly completed exemption certificate within 90 days of delivery.
• Review all certificates for completeness and validity—never accept a certificate that is incomplete, inconsistent, or obviously false.
• Train sales and accounting staff on certificate verification procedures.
• Retain exemption certificates and related sales documentation for at least three years after the due date of the return covering the sale (the minimum statutory recordkeeping period; longer in case of audit).
• If in doubt about the validity of a certificate, collect tax or obtain other supporting evidence.

Caution / review status: Not yet human confirmed. The above reflects the exact language and obligations under Tax Law § 1132(c), 20 NYCRR § 532.4, and DTF’s published bulletins. There is some administrative nuance around "good faith" (especially for casual or flagged purchasers), and edge-case scenarios (e.g., chain transactions, drop shipments, and electronic certificates) may require additional human review or direct DTF guidance.

Source: N.Y. Tax Law § 1132(c) Source: 20 NYCRR § 532.4 Source: Tax Bulletin TB-ST-240