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How to Apply for Sales Tax Exemption in Ohio: A Complete Step-by-Step Guide

How to Apply for Sales Tax Exemption in Ohio: A Complete Step-by-Step Guide

If your business, nonprofit, or organization operates in Ohio, you may qualify for sales tax exemption on certain purchases. Understanding how to apply for sales tax exemption in Ohio can help you reduce costs, stay compliant, and avoid paying tax unnecessarily.

What Is Sales Tax Exemption in Ohio?

Ohio allows certain businesses, nonprofits, resellers, and organizations to purchase goods tax-free if they meet specific criteria. Rather than “applying” to the state for approval, most entities provide an exemption certificate to the seller.

This certificate proves that the buyer is authorized to make tax-exempt purchases under Ohio law.

Who Qualifies for Sales Tax Exemption in Ohio?

Ohio sales tax exemption applies to several categories:

✔️ 1. Resellers / Retailers

Businesses purchasing inventory for resale.

✔️ 2. Nonprofit Organizations

501(c)(3) organizations and charitable groups.

✔️ 3. Government Agencies

Federal, state, county, or city entities.

✔️ 4. Manufacturers / Production Facilities

Equipment used directly in manufacturing or production.

✔️ 5. Agricultural Businesses

Farmers purchasing qualifying items for agricultural use.

✔️ 6. Church or Religious Organizations

✔️ 7. Contractors Purchasing for Tax-Exempt Projects

Each category requires the correct exemption certificate.

Ohio Sales Tax Exemption Forms (Most Important Forms)

Ohio uses multiple exemption certificates depending on the type of exemption. The most commonly used forms include:

🧾 1. STEC-B – Blanket Exemption Certificate

Used for ongoing exempt purchases (commonly used by resellers).

🧾 2. STEC-U – Unit Exemption Certificate

Used for a single purchase or one-time exemption.

🧾 3. ST-1 – Sales and Use Tax Certificate of Exemption

Covers most categories, including:

  • Charitable organizations

  • Churches

  • Government agencies

  • Agricultural uses

  • Manufacturing uses

  • Resale

You do NOT submit these forms to the State of Ohio.
You provide them directly to the seller.

How to Apply for Sales Tax Exemption in Ohio (Step-By-Step)

Here’s the exact process to follow to claim sales tax exemption correctly.

Step 1: Determine Your Exemption Type

Identify why your organization qualifies:

  • Resale?

  • Charitable nonprofit?

  • Agriculture?

  • Government?

  • Manufacturer?

  • Construction contract?

Different exemptions require different forms.

Step 2: Gather Required Documentation

Most businesses need:

  • FEIN (Federal Employer Identification Number)

  • Ohio Vendor’s License number (if applying for reseller exemption)

  • IRS determination letter (for nonprofits)

  • Project documentation for contractors

  • Description of intended use of the goods

Step 3: Complete the Correct Ohio Exemption Certificate

Choose the right form:

✔️ For Resale → STEC-B (Blanket)

✔️ For One-Time Use → STEC-U (Unit Use)

✔️ For Exempt Organizations → ST-1

Forms require:

  • Legal business name

  • Address

  • Taxpayer ID

  • Type of exemption

  • Signature of authorized representative

Step 4: Provide the Certificate to the Seller

You give the exemption certificate directly to the retailer, wholesaler, or vendor.
They keep it on file for audit purposes.

The State of Ohio does not approve or deny exemption certificates; the seller is responsible for accepting them.

Step 5: Keep Records for Audit Purposes

Both the buyer and seller must maintain:

  • Copy of the exemption certificate

  • Supporting documents (e.g., nonprofit determination letter)

  • Invoice that matches the exemption claim

Ohio audits sellers frequently, so accuracy is key.

Common Mistakes to Avoid When Applying for Ohio Sales Tax Exemption

  • Using the wrong form (ST-1 vs. STEC-B)

  • Forgetting to specify exemption category

  • Not signing the form

  • Not including your FEIN or vendor license number

  • Claiming exemption for non-qualifying purchases

These errors can cause the seller to deny your exemption or risk penalties in an audit.

Frequently Asked Questions

Do I need pre-approval from the Ohio Department of Taxation?

No. Ohio does not require prior approval. You simply provide the exemption certificate to the seller.

Do nonprofits automatically qualify?

Most 501(c)(3) organizations qualify, but they must provide Form ST-1 to the seller.

Is sales tax exemption the same as being a tax-exempt organization?

No — a nonprofit must still follow Ohio rules and provide exemption certificates for each purchase.

Can an online purchase be tax-exempt?

Yes. Provide the certificate to the online vendor’s tax team before checkout or request a refund of sales tax.

Conclusion: Ohio Sales Tax Exemption Is Easy When You Use the Right Form

Applying for sales tax exemption in Ohio is straightforward once you know:

✔️ Which exemption applies to you
✔️ Which certificate to use
✔️ How to complete and submit it properly

Whether you're a nonprofit, a reseller, a farmer, or a manufacturer, providing the correct form to your vendor ensures your purchases remain tax-free and compliant with Ohio law.

If you need help completing your Ohio exemption forms or determining which exemptions apply to your business, we’re here to assist.

👉 Contact us today for expert sales tax compliance support.

Mitchell Levinsales tax, sales tax exemption, OHIO