42-5040.01. Sourcing of tangible personal property; third-party service providers; certification
391 words·~2 min read·
/az/title-42/42-5040-01A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
A. Beginning on or before January 1, 2028, the department shall establish a process by which a third-party provider that offers sourcing services to taxpayers for transactions involving tangible personal property may become certified in this state. A certified third-party service provider shall meet all of the requirements established by the department.
B. The director shall:
1. Supervise and regulate all persons required by this section to obtain certification.
2. Establish minimum standards for certification and a quality assurance program for authorized third parties to ensure that a certified third-party service provider is complying with the minimum standards.
3. Post a list of certified third-party service providers on the department's website.
4. Adopt rules to administer and enforce this section.
C. The director may:
1. Investigate and audit third-party service providers as necessary to ensure compliance with this section.
2. Require that a certified third-party service provider or any employees or agents of the certified third-party service provider be certified by the department to perform certain functions.
D. A person may apply to the department to be a certified third-party service provider on a form prescribed and furnished by the director. The person shall include with the application all documents and fees prescribed by the director. The application shall contain, at a minimum:
1. The name, telephone number and address of the applicant and primary contact person.
2. Verification that the applicant meets the requirements prescribed by the director.
3. Other information the director requires.
E. A taxpayer may use a certified third-party service provider to assist the taxpayer in sourcing transactions involving tangible personal property. A taxpayer that uses a certified third-party service provider for sourcing transactions involving tangible personal property is not liable for failing to pay the correct amount of tax due to an error in sourcing the transaction. The taxpayer is liable for failing to pay the correct amount of tax if the failure to pay the correct amount of tax was due to an error other than an error in sourcing the transaction.
A certified third-party service provider is liable for the amount of tax the taxpayer failed to pay if the failure to pay the correct amount of tax was due to an error in sourcing the transaction, unless the error was due to incorrect information the certified third-party service provider received from the department.