Ezel / Tax Rulings / TX
TX 9606L1420A04 Motor Vehicle Tax 1996-06-17

Could a dealer rely on an auction house's blanket resale certificate when the certificate named the auction rather than the dealer as seller?

Short answer: No. The auction house acted as the dealer's agent, so the dealership was the seller and had to be named on the blanket resale certificate. The required resale-certificate wording could be incorporated into the auction document or invoice rather than placed on a separate form.

Apply this to your situation

This page answers the general question as of 1996. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1996
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official Texas Comptroller letter issued on one dealer's 1996 auction resale-certificate procedure. It predates modern Private Letter Ruling reliance terms and cannot be treated by unrelated taxpayers as binding protection. Seller identification, agency, blanket-certificate, invoice wording, retention, and auction documentation rules may have changed. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page) is the authoritative source for any reliance.

Plain-English summary

The Texas Comptroller said the auction house was acting as the selling dealer's agent. The dealership—not the auction house—was therefore the seller for resale-certificate documentation.

A blanket resale certificate was acceptable only if it named the dealership as seller.

The required certificate wording could be incorporated into the auction document or invoice; it did not have to appear on a separate form.

What this means for you

Motor vehicle dealers

Do not rely on historical auction documentation that identifies only the agent when the dealer is the seller.

Auto auction companies and accountants

The letter permitted integrated invoice wording but required correct seller identification.

Common questions

Q: Could the certificate name only the auction house?

A: No.

Q: Did the resale wording need a separate document?

A: No. It could be incorporated into the auction document or invoice.

Citations and references

  • The letter did not identify a statute or administrative rule by number.

Source

Original ruling text

June 17, 1996

Dear ***:

I have received your letter regarding the proper use of the Texas Motor
Vehicle Sales Tax Resale Certificate.

Facts: You are a car dealer and sell some motor vehicles through auctions.
The auctioneer has told you they will secure a blanket Texas Motor Vehicle
Sales Tax Resale Certificate to keep on file; however, the resale
certificate shows the auction house listed as the seller, not your
dealership. The auction house says they are not able to secure resale
certificates showing your dealership as the seller due to the volume of
business they run through the auction. They want you to accept their resale
certificate.

Question: You ask if the blanket resale certificate from the buyer of your
vehicle to the auction house acceptable for your records, or if you should
secure a resale certificate from the buyer showing your dealership as seller.

Response: You are correct to question the resale certificate. The auction
house is serving as your agent and your dealership is the seller of the
vehicle. A blanket resale certificate would be acceptable if it named your
dealership as seller. Many auction houses are incorporating the wording from
the resale certificate into the auction document/invoice. This documentation
is acceptable, as the resale certificate wording does not have to be on a
separate document.

This opinion is based on the facts presented. If there are additional or
different facts, the opinion could change.

If you have any questions, please don't hesitate to call one of our tax
specialists toll free at 1-800-252-1382. The direct number is 512/463-4600.
You may also write to Tax Policy Division, Comptroller of Public Accounts.

Sincerely,

Joan Hale
Tax Policy Division

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