If you’re looking for “Form ST-12” as a New York sales tax exemption certificate, the number is a common mix-up: New York’s exempt use certificate is Form ST-121, and it’s the only exempt use certificate the Department of Taxation and Finance publishes.1New York State Department of Taxation and Finance. Sales Tax Exemption Documents Filed correctly, ST-121 lets a qualifying buyer purchase specific tangible personal property or services without paying the state’s 4% sales tax or any local sales tax that would otherwise apply.2New York State Department of Taxation and Finance. New York State and Local Sales and Use Tax Exempt Use Certificate It’s often confused with Form ST-120, which is the resale certificate. Different form, different purpose.
What Purchases Qualify
ST-121 is narrow. It covers specific exempt uses set out in New York Tax Law Section 1115(a) and grouped on the form into three parts. Most buyers land in Part 1 (production-related property) or Part 2 (services performed on that property). The main categories:
- Machinery, equipment, parts, tools, and supplies used directly and predominantly in producing tangible personal property for sale, or in generating gas, electricity, refrigeration, or steam for sale (Box A).3New York State Senate. New York Code TAX 1115 – Exemptions From Sales and Use Taxes
- Property used or consumed in producing a film for sale (Box B).
- Property used or consumed in providing telecommunications or internet access services for sale (Box C).
- Equipment and supplies used by TV or radio broadcasters in producing or transmitting programs (Box D).
- Gas or electricity used to operate a pipeline, transmission line, or distribution line (Box E).
- Fuel, gas, electricity, refrigeration, or steam consumed during the production of tangible personal property or utilities for sale (Boxes F and G).
- Installing, repairing, maintaining, or servicing property that qualifies under Boxes A through D (Box H).
- Other exempt uses (Box U), where you describe the use and cite the specific section of the Tax Law.
Additional boxes cover commercial fishing vessels, pollution control equipment, aircraft maintenance supplies, and cargo-handling machinery at qualified marine terminals in New York City.2New York State Department of Taxation and Finance. New York State and Local Sales and Use Tax Exempt Use Certificate Farmers use a different form, ST-125, not ST-121.
Directly, Predominantly, Exclusively
Most Part 1 exemptions require the property to be used “directly and predominantly” in the qualifying activity. The form defines “predominantly” as more than 50% of the time spent on the exempt purpose, and New York’s regulations apply both the direct-use and predominant-use tests.4New York Codes, Rules and Regulations. 20 CRR-NY 528.11 – Directly, Predominantly, Exclusively A forklift used 60% of the time to move raw materials on a factory floor and 40% for office furniture qualifies. A printer used 80% for internal memos and 20% for product labels doesn’t.
Some boxes use a different threshold. The form defines “exclusively” as 100% of the time and “primarily” as 50% or more. Read the qualifying word next to the specific box you’re claiming; it tells you which standard applies.
Filling Out Form ST-121
Download the fillable PDF from the Department of Taxation and Finance. The form runs four pages: page one holds the header and Part 1, page two holds Parts 2 and 3 plus the signature block, and pages three and four are instructions. Every entry matters. An incomplete certificate is not valid.
Header Fields
Enter the seller’s name and address first, then your name and business address as the purchaser. Mark an X in either “Single-purchase certificate” (a one-time transaction) or “Blanket certificate” (all future similar purchases from that seller).5New York State Department of Taxation and Finance. Exemption Certificates for Sales Tax A blanket certificate stays in effect indefinitely, but you have to issue an updated one if your address, ID number, or other details change, and the seller can request an updated blanket certificate at any time.
Marking the Exemption
Mark an X next to every box that applies. For Part 1 and Part 2 exemptions, enter your Certificate of Authority number, which is the sales tax ID issued when you registered as a vendor with New York State.6New York State Department of Taxation and Finance. How to Register for New York State Sales Tax Part 3 exemptions don’t require one. If you check Box U, describe the exempt use clearly and cite the Tax Law section that authorizes it.
Be specific about what you’re buying and why. “Manufacturing equipment” alone won’t survive an audit. The use has to tie back to the actual production of goods or services for sale, and if a piece of equipment serves both qualifying and non-qualifying functions, the qualifying use must exceed 50% before you claim the exemption.
Signing the Certificate
The form is not valid without the certification on page two. The owner, a partner, or an authorized person must sign, print their name and title, and date the certificate. That signature is a legal attestation that everything on the form is true and correct.2New York State Department of Taxation and Finance. New York State and Local Sales and Use Tax Exempt Use Certificate
Giving the Certificate to the Seller
Hand the completed ST-121 to the seller at the time of the sale. If that isn’t possible, you have up to 90 days after delivery of the property or completion of the service to provide it.7New York State Senate. New York Code TAX 1132 – Collection of Tax From Customer Miss that window and the sale is treated as taxable from the start. Vendors can accept certificates electronically or on paper.
When the vendor receives a properly completed certificate within 90 days and accepts it in good faith, the vendor is not on the hook for the uncollected tax on that transaction. “Good faith” means the vendor had no knowledge the certificate was false and exercised reasonable ordinary due care.8New York Codes, Rules and Regulations. 20 CRR-NY 532.4 – Presumption of Taxability The burden of proving the purchase was taxable then shifts to the purchaser.7New York State Senate. New York Code TAX 1132 – Collection of Tax From Customer A certificate that clearly doesn’t match the buyer’s business, such as a law office claiming a manufacturing exemption on a desk, is a red flag that can strip the seller’s good-faith protection.
Records to Keep
Both sides need copies. Tax Law Section 1135 requires every vendor to keep records of each transaction, including copies of exemption certificates matched to the invoices they cover.9New York State Senate. New York Code TAX 1135 – Records to Be Kept Purchasers should keep sales receipts with their copy of the ST-121 to show the property was actually used for the exempt purpose claimed.
New York’s general statute of limitations for sales tax assessments is three years from the date a return was filed, so three years is the practical minimum. The lookback stretches to six years if the Department suspects underreporting of more than 25% of taxable receipts, and there’s no time limit at all if a return was never filed or was fraudulent. The IRS separately recommends keeping business records for at least three years.10Internal Revenue Service. How Long Should I Keep Records Six years is the safer floor when exempt-use claims involve large dollar amounts.
Penalties for a False Certificate
The penalties for filing a false ST-121 stack on top of the unpaid tax itself:
- A penalty equal to 100% of the tax that should have been paid, if the certificate was issued with intent to evade tax.11New York State Senate. New York Code TAX 1145 – Penalties and Interest
- An additional $50 for each fraudulent certificate issued.12New York State Department of Taxation and Finance. Sales and Use Tax Penalties
- Interest on unpaid sales tax at a minimum of 14.5% per year, or a higher rate set by the Commissioner, running from the original due date.11New York State Senate. New York Code TAX 1145 – Penalties and Interest
- Criminal prosecution under Tax Law Sections 1801 through 1807 for willfully issuing a false exemption certificate, carrying potential fines and jail time.12New York State Department of Taxation and Finance. Sales and Use Tax Penalties
- Revocation of your Certificate of Authority, which shuts down your ability to legally collect sales tax and operate as a registered vendor.
The 100% penalty and criminal exposure both require intent to evade. Honest mistakes, such as checking the wrong box or forgetting to reissue a blanket certificate after your business changed, don’t trigger those, but you’ll still owe the underlying tax plus interest.
If You Use a Multi-State Certificate Elsewhere
New York is not a member of the Streamlined Sales and Use Tax Agreement, so the standardized multi-state exemption certificate accepted by 24 other states doesn’t work with New York vendors.13Streamlined Sales Tax Governing Board. Exemptions If you’re used to filing the Streamlined certificate in Indiana, Michigan, New Jersey, or Ohio, you’ll need to file a separate ST-121 for your New York purchases. A New York seller has no obligation to accept the Streamlined form and no protection from the Department if they do.