§ 6-2.5-11-10 — Certified services providers; allowances for sellers and certified service providers under the agreement; relief for failure to collect tax

(a) A certified service provider is the agent
of a seller, with whom the certified service provider has contracted, for
the collection and remittance of sales and use taxes. As the seller's
agent, the certified service provider is liable for sales and use tax due
each member state on all sales transactions it processes for the seller
except as set out in this section. A seller that contracts with a certified
service provider is not liable to the state for sales or use tax due on
transactions processed by the certified service provider unless the seller
misrepresented the type of items it sells or committed fraud. In the
absence of probable cause to believe that the seller has committed
fraud or made a material misrepresentation, the seller is not subject to
audit on the transactions processed by the certified service provider. A
seller is subject to audit for transactions not processed by the certified
service provider. The member states acting jointly may perform a
system check of the seller and review the seller's procedures to
determine if the certified service provider's system is functioning
properly and the extent to which the seller's transactions are being
processed by the certified service provider.
(b) A person that provides a certified automated system is
responsible for the proper functioning of that system and is liable to the
state for underpayments of tax attributable to errors in the functioning
of the certified automated system. A seller that uses a certified
automated system remains responsible and is liable to the state for
reporting and remitting tax.
(c) A seller that has a proprietary system for determining the amount
of tax due on transactions and has signed an agreement establishing a
performance standard for that system is liable for the failure of the
system to meet the performance standard.
(d) A certified service provider or a seller that obtains a certification
or taxability matrix from the department is not liable for sales or use
tax collection errors that result from reliance on the department's
certification or taxability matrix. If the department determines that an
item or transaction is incorrectly classified as to the taxability of the
item or transaction, the department shall notify the certified service
provider or the seller of the incorrect classification. The certified
service provider or the seller must revise the incorrect classification
within ten (10) days after receiving notice of the determination from
the department. If the classification error is not corrected within ten
(10) days after receiving the department's notice, the certified service
provider or the seller is liable for failure to collect the correct amount
of sales or use tax due and owing.
(e) If at least thirty (30) days are not provided between the
enactment of a statute changing the rate set forth in IC 6-2.5-2-2 and
the effective date of the rate change, the department shall relieve the
seller of liability for failing to collect tax at the new rate if:
(1) the seller collected the tax at the immediately preceding
effective rate; and
(2) the seller's failure to collect at the current rate does not extend
beyond thirty (30) days after the effective date of the rate change.
A seller is not eligible for the relief provided for in this subsection if
the seller fraudulently fails to collect at the current rate or solicits
purchases based on the immediately preceding effective rate.
(f) The department shall allow any monetary allowances that are
provided by the member states to sellers or certified service providers
in exchange for collecting the sales and use taxes as provided in article
VI of the agreement.

Legislative History

As added by P.L.107-2001, SEC.1. Amended by P.L.195-2005, SEC.4; P.L.145-2007, SEC.9; P.L.182-2009(ss), SEC.183; P.L.113-2010, SEC.53; P.L.84-2011, SEC.4.