Michigan Laws 205.94i – Exemption for drop shipments; definition
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Terms Used In Michigan Laws 205.94i
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- person: may extend and be applied to bodies politic and corporate, as well as to individuals. See Michigan Laws 8.3l
- Personal property: All property that is not real property.
- state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o
(1) A seller required to collect the tax under this act shall be exempt from collecting the tax on sales of tangible personal property if the tangible personal property is part of a drop shipment and if the taxpayer complies with the requirements of subsection (3).
(2) As used in this section, “drop shipment” means the direct delivery of tangible personal property to a purchaser in Michigan by a person who has sold the property to another person not licensed under this act but possessing a resale or exemption certificate or other written evidence of exemption authorized by another state, or any other acceptable information evidencing qualification for a resale exemption, for resale to the Michigan purchaser.
(3) For each transaction for which an exemption is claimed under subsection (1), the taxpayer shall provide the following information to the department annually in any reasonable form:
(a) The name, address, and, if readily available, the federal taxpayer identification number of the person to whom the property is sold for resale.
(b) The name, address, and, if readily available, the federal taxpayer identification number of the person to whom the property is shipped in Michigan.
(4) A person making a drop shipment is a seller.