Help Center: Businesses

An amended return should be filed for each reporting period in which errors occurred or amounts require updating. Taxpayers who used the OkTAP online filing system may amend their reports online. Taxpayers who filed a paper report should file the amended report in the same manner. Please indicate on the top of the report “AMENDED”.

For corporations who filed a Form 512:

• If you are filing an amended 512 for tax year 2013 and thereafter, place an X in the box at the top of the Form 512 as this indicates the return is being amended.
• If you are filing an amended 512 for tax year 2012 and prior, use Form 512X.

For S corporations who filed a Form 512S:

• If you are filing an amended 512S for tax year 2008 and thereafter, place an X in the box at the top of the Form 512S as this indicates the return is being amended.
• If you are filing an amended 512S for tax year 2007 and prior, use Form 512S and place an "X" on the line next to the form number (512S X), as this indicates the return is an amended one.

For partnerships who filed a Form 514:

• If you are filing an amended 514 for tax year 2008 and thereafter, place an X in the box at the top of the Form 514 as this indicates the return is being amended.
• If you are filing an amended 514 for tax year 2007 and prior, use Form 514 and place an "X" on the line next to the form number (514X), as this indicates the return is an amended one.

For estates who filed a Form 513:

• If you are filing an amended 513 for tax year 2008 and thereafter, place an X in the box at the top of the Form 513 as this indicates the return is being amended.
• If you are filing an amended 513 for tax year 2007 and prior, use Form 513 and place an "X" in the "Amended Return" box located at the top of the form.

For trusts who filed a Form 513NR:

• If you are filing an amended 513NR for tax year 2008 and thereafter, place an X in the box at the top of the Form 513NR as this indicates the return is being amended.
• If you are filing an amended 513NR for tax year 2007 and prior, use Form 513NR and place an "X" in the "Amended Return" box located at the top of the form.

For organizations exempt from income tax who filed a Form 512E:

• If you are filing an amended 512E for tax year 2013 and thereafter, place an X in the box at the top of the Form 512E as this indicates the return is being amended.
• If you are filing an amended 512E for tax year 2012 and prior, use Form 512E and write “Amended” in the top left corner of the form.

The OTC will accept payment in any of the following forms: ACH Debit, ACH Credit, credit card, cash, check or money order.

 Electronic funds transfer/e-checks are accepted for many tax types.

If you find yourself owing taxes on an account and are unable to send the funds with the return, options are available to resolve the payment on these accounts. Please file the report by the due date and pay any amount you can. You will be billed for the tax balance due plus penalty and interest, the bill will explain payment options. If you resolve your account within this billing process, no other contact with the OTC is necessary. If you cannot pay your account in full through the billing process, please contact the Collections Division to set up a suitable payment arrangement.

• Interest at 1.25% per month will apply to the tax liability from the due date until the date paid. The penalty amount for all business taxes is 10% of the tax due.
• Upon payment of the tax, any taxpayer may request a waiver of the assessed penalty and/or interest. Facts surrounding the circumstances that prevented timely filing and/or payment should be included when making the request.

You may view a list of the allocable and transferable credits on page 4 and 5 of Form 569. If you do not see your credit, you do not have to file a Form 569. For current Oklahoma tax forms, visit the Forms page.

Yes, file Form 569 to report any tax credit, authorized to be claimed under Title 68 of the Oklahoma Statutes that has been transferred or allocated on or after July 1, 2011.

If the transferor fails to file Form 569, the tax credit may be disallowed. The transferee may not file the return on behalf of the transferor. For current Oklahoma tax forms, visit the Forms page.

This is a standalone form used to report an income tax credit authorized under Title 68 of the Oklahoma Statutes that has been transferred or allocated on or after July 1, 2011. Do not put multiple credits on one Form 569 if transferring or allocating all of the credits to the same person or entity. For current Oklahoma tax forms, visit the Forms page.

It’s time for fireworks!

The registration window is June 15 through July 6.

Get started now!

How to Register for a Permit

Whether you’re a new or returning business registering for a permit to sell fireworks, the instructions are the same. Follow these simple steps:

• Go to the OkTAP website.
• Click Register for a Business.
• Click Business Registration.
• Under New Business Registration:
  • Select No to Are you a remote seller?
  • Select No to Are you a direct wine shipper?
• Under I am filling out this application because I want to…, select Register or add a new sales/use/wholesale tax permit.
• Click Next.
• Follow the step-by-step instructions. Each screen leads to the next step.
• Once you arrive at the screen asking questions identifying the specific business type, answer all the questions.
  • Select Yes to Do you sell retail fireworks?
  • Selecting Yes adds a firework retail permit designation to the requested sales tax permit.
• After completing the electronic business application, allow 5-10 business days for processing.
• If approved, an OkTAP account number will be provided along with applicable permits.

You’re ready to visit OkTAP!

New business? Find helpful information in the New Business Center.

Contact Us

Schedule an appointment to skip lines and save time!

or

Speak with a representative by phone at 405.521.3160.

Form 569 must be filed on or before the 20th day of the second month after the tax year in which the transfer or allocation of a credit occurs. 

Form 569 can be filed electronically online or downloaded and mailed to the OTC. For current Oklahoma tax forms, visit the Forms page.

No, the Form 538-H Credit for Refund of Property Taxes and Form 538-S Sales Tax Refund may not be transferred or allocated. For current Oklahoma tax forms, visit the Forms page.

If a tax credit is transferred on or after July 1, 2011, Form 572 is due thirty days after the credit is transferred. Form 569 is due the twentieth day of the second month following the close of the tax year in which the transfer of the credit occurred. For current Oklahoma tax forms, visit the Forms page.

911 telephone fees applies to all entities that transact sales of wireless telecommunications in Oklahoma.

A $1.25 911 telephone fee is required to be collected and remitted as follows:

1. Monthly on each wireless telephone connection and other communication device or service connection with the ability to dial 911 for emergency calls;
2. Monthly on each service that is enabled by Voice over Internet Protocol (VoIP) or Internet Protocol (IP) with the ability to dial 911 for emergency calls; and
3. On each prepaid wireless retail transaction occurring in this state.

The fee is due by the 20th of each month. File on OkTAP.

To report fraudulent activity, call 405.521.3251 or email businesstaxaudit@tax.ok.gov.

Yes, paper returns are still accepted. A total prohibition on the submission of paper returns has not been implemented. There is no procedure for advance exemption from electronic filing. Returns should be submitted in a timely fashion by the best means possible.

Additional guidance regarding electronic filing requirements will be provided as it becomes available.

You can obtain a sales tax permit by applying online on OkTAP.

• A sales tax permit is needed if you are selling tangible personal property for monetary or other consideration on an ongoing basis. All consideration received for the sale is included in gross receipts subject to tax.
• “Tangible personal property” is that which can be seen, weighed, measured, felt or touched or that is in any other manner perceptible to the senses, including electricity, water, gas steam and prewritten computer software for frequent or occasional sales.
• No permit is issued or required for occasional sales, file a report only when sales are made. Indicate on the sales tax report it is a “casual” sale.

For most sales tax permit holders, the sales tax from sales made within the state from the first day of the month through the last day of the month must be remitted to the OTC on or before the twentieth day of the month following the month in which the sale was made.

Oklahoma sales tax law authorizes semi-annual filing when the tax remitted by the vendor does not exceed $50 a month. Semi-annual sales tax reports are due by July 20^th, for the period covering January through June, and January 20^th, for the period covering July through December.

Sales tax permit holders whose returns average $2500 or more per month, measured by the previous fiscal year, must participate in the OTC electronic data interchange program.

Agricultural permits are cards issued to persons directly involved in farming and ranching exempt from sales tax. Oklahoma residents can apply online through OkTAP. Non-residents should call our Taxpayer Resource Center at 405.521.3160 for more information.

Vendors can purchase merchandise for resale tax free with a sales tax permit.

Every state with a sales tax has a companion tax for purchases made outside the state, in Oklahoma, that tax is called “use tax”. If you have purchased items for use in Oklahoma from retailers who do not collect Oklahoma sales tax, you owe Oklahoma use tax on those items. Individuals in Oklahoma are responsible for paying use tax on their out-of-state purchases. An Oklahoma sales tax permit is valid for purchase for resale in Oklahoma only.

If you are an out-of-state vendor reporting use tax that you have collected from Oklahoma customers, please use the Oklahoma Vendor Use Tax Return.

If you are an Oklahoma consumer that has purchased goods outside the state of Oklahoma where the tax was not charged in another state, please use the Oklahoma Consumer Use Tax Return.

A sales tax holiday is a period of time when retail sales taxes are not collectible or payable on a specific class of purchases.

Oklahoma's 2024 sales tax holiday is August 2, 3 and 4th.

Sales of any article of clothing or footwear designed to be worn on or about the human body and the sales price of the article is less than one hundred dollars are exempt. This does not apply to the sale of any accessories, special clothing or footwear primarily designed for athletic activity or protective use that is not normally worn except when used for athletic activity or protective use, or to the rental of clothing or footwear.

Any special clothing or footwear that is primarily designed for an athletic activity or protective use that is not normally worn except when used for athletic activity or protective use for which it is designed. Accessories including jewelry, handbags, luggage, umbrellas, wallets, watches, and other similar items carried on or about the human body, without regard to whether worn on the body in a manner characteristic of clothing are considered taxable. The rental of clothing or footwear is also taxable.

Yes, retailers may not charge tax on items that are tax-exempt during the sales tax holiday weekend.

Yes, eligible items will qualify for the exemption when final payment on the layaway is made and the item is given to the customer during the exemption period.

Yes, if an eligible item is less than $100 it is sales tax exempt during the sales tax holiday. An item that is $100 or more is taxable.

It’s time for fireworks!

The registration window is June 15 through July 6.

Get started now!

How to Register for a Permit

Whether you’re a new or returning business registering for a permit to sell fireworks, the instructions are the same. Follow these simple steps:

• Go to the OkTAP website.
• Click Register for a Business.
• Click Business Registration.
• Under New Business Registration:
  •  Select No to Are you a remote seller?
  • Select No to Are you a direct wine shipper?
• Under I am filling out this application because I want to…, select Register or add a new sales/use/wholesale tax permit.
• Click Next.
• Follow the step-by-step instructions. Each screen leads to the next step.
• Once you arrive at the screen asking questions identifying the specific business type, answer all the questions.
  • Select Yes to Do you sell retail fireworks?
  • Selecting Yes adds a firework retail permit designation to the requested sales tax permit.
• After completing the electronic business application, allow 5-10 business days for processing.

If approved, an OkTAP account number will be provided along with applicable permits.

You’re ready to visit OkTAP!

New business? Find helpful information in the New Business Center.

Contact Us

Schedule an appointment to skip lines and save time!

or

Speak with a representative by phone at 405.521.3160.

Eligible items sold to purchasers by mail, telephone, email or internet shall qualify for the sales tax exemption if the customer orders and pays for the item and the retailer accepts the order during the exemption period for immediate shipment, even if delivery is made after the exemption period.

Eligible items purchased during the sales tax holiday using a previously issued raincheck qualify for the exemption. If a raincheck issued during the sales tax holiday is redeemed after the sales tax holiday, the purchase is not tax exempt.

If a customer buys an eligible item during the sales tax holiday and later exchanges it for the same item in a different size or color, tax is not to be charged even if the exchange is made after the sales tax holiday. If a customer buys an eligible item during the sales tax holiday and returns the item after the tax holiday period for credit on the purchase of a different item, sales tax applies to the sale of the newly purchased item, even if it would have been eligible for the exemption during the sales tax holiday. If a customer buys an eligible item before the holiday period but returns the item during the sales tax holiday period and receives credit on the purchase of a different item of eligible property, no sales tax is due on the sale of the new item.

If a retailer offers a discount to reduce the price of an eligible item to less than $100 the item will qualify for the sales tax exemption. This applies to all discounts even if a retailer’s coupon or loyalty card is required to secure the discount. If a retailer accepts a coupon that entitles the retailer to third-party reimbursement, such as a manufacturer’s coupon, the discount provided by the coupon does not reduce the item’s sales price for purposes of determining whether the item is eligible for the exemption.

Sales of eligible items exempted by the sales tax holiday should be reported on line 3g, “Other Legal Sales Tax Exemptions” of the Oklahoma Sales Tax report.

A report is considered to have been filed with and received by the OTC on the date shown by the post office cancellation mark stamped upon the envelope.

“Clothing” means all human wearing apparel suitable for general use. A nonexclusive list of clothing that is exempt from sales and use taxes follows:

• Aprons, household and shop
• Athletic supporters
• Baby receiving blankets
• Bathing suits and caps
• Beach capes and coats
• Belts and suspenders
• Boots
• Coats and jackets
• Costumes
• Diapers, children and adult, including disposable diapers
• Earmuffs
• Footlets
• Formal wear
• Garters and garter belts
• Girdles
• Gloves and mittens for general use
• Hats and caps
• Hosiery
• Insoles for shoes
• Lab coats
• Neckties
• Overshoes
• Pantyhose
• Rainwear
• Rubber pants
• Sandals
• Scarves
• Shoes and shoelaces
• Slippers
• Sneakers
• Socks and stockings
• Steel toed shoes
• Underwear
• Uniforms, athletic and non-athletic
• Wedding apparel

Business tax returns are due to the OTC no later than the 20th of the month following the month for which the return and remittances are made. Medical marijuana sales tax may only be paid in cash.

If a due date falls on Saturday, Sunday or on an observed state holiday, the report is due on the next business day.

The use of ZIP+4 area codes in the (county and municipal) tax rate data system is intended to define the smallest area to prevent overlapping boundaries. The 4-digit add-on number identifies a geographic segment within a 5-digit zip code area, such as a city block, office building, or any other area designated by the postal service.

In some ZIP+4 area codes there is an overlap of county and municipal boundaries. When this occurs, the statute provides that the lowest rate in the area shall apply. For example, City A has a combined state and city rate of 8%. City B has a combined state and city rate of 7.5%. If the ZIP+4 area code includes both City A and City B, the data system will assign a combined state and city rate of 7.5%. The collections from an area that includes more than one jurisdiction will be allocated between the jurisdictions based upon population.

You may contact the Address Management Systems Office of the U.S. Postal Service for more information about ZIP+4 codes in your area.

The correct amount of Oklahoma income tax to be withheld from each pay period can be found in the withholding tables for the current year on our Publications page.

Most employers are required to withhold Oklahoma income tax from wages earned in Oklahoma. A withholding account is required. New accounts will need to be registered through OkTAP.

Oklahoma wage withholding is reported on Form WTH10001. For current Oklahoma tax forms, visit the Forms page.

Employers are required to report the income tax withheld according to the following:

• Employers who withhold less than $500 per quarter will remit quarterly.
• Employers who are required to follow the federal semi-weekly reporting schedule must report to Oklahoma in the same manner.
• All other employers will remit monthly.

With the rollout of a system update in May 2025, functionality surrounding quarterly withholding returns will be changing. Previously, in certain instances, our system automatically created returns based off payment information when a return was not filed timely. However, starting in Quarter 2 (period ending June 30, 2025), each quarterly withholding return will need to be manually generated and then filed. This will have its largest impact with third party payroll providers.

A quarterly return is statutorily required (Title 68, Section 2385.3) and if not filed, the tax accounts will become delinquent and could result in future audits.

Options regarding filing withholding returns can be found below:

• The preferred method is to file electronically via OkTAP. 
• Form WTH 10001 can be found on the Oklahoma Tax Commission’s website. Submission instructions are found on Form WTH 10001. 
• Third party payroll providers can file bulk returns once registered. For more information on this process, please email kyle.coatney@tax.ok.gov.

Employees may change or increase their Oklahoma withholding rates by completing a new Form OK-W-4. Oklahoma wage withholding is reported on Form WTH10001. For current Oklahoma tax forms, visit the Forms page.

Withholding tables are adjusted when the income tax rates change. Generally, the release occurs during the last week of December.

Business owners are required to withhold and pay state withholding tax on wages paid to an employee. Business owners are not required to withhold or pay state withholding tax on payments made to independent contractors.

Franchise Tax – HB 1039X FAQ

Oklahoma Franchise tax is ending. When does this go into effect?

Tax year 2023 is the last year that franchise tax returns will be required to be filed. Starting with tax year 2024 and beyond, there will be no Oklahoma franchise tax filing requirement.

When are tax year 2023 returns due?

If you file a Form FRX 200:

• Taxpayers who remit the maximum amount of tax (those that owe $20,000 in the preceding tax year) are required to remit annually by May 1; the final franchise tax return must be remitted on or before June 1, 2024 to avoid being delinquent.
• All other taxpayers are required to remit by July 1, unless the taxpayer has elected to pay the tax as part of the corporate income tax return; the final franchise tax return must be remitted on or before September 15, 2024 to avoid being delinquent.

If you have elected to file as part of your corporate income tax return:

• Franchise tax must be remitted with the filing of the tax year 2023 corporate income tax return. A corporation that elects to use its income tax return due date for payment and filing of the corporation’s franchise tax return shall use the corporation’s 2023 income tax year balance sheet in preparing the return.

Failure to remit the required franchise tax will result in potential suspension of the corporation.

The Tax Commission collects a Registered Agent's Fee on behalf of the Secretary of State. How will this be affected?

The Tax Commission is currently in discussion with the Secretary of State to determine how this will be handled moving forward. Additional information will be made available once this has been determined.

Will we still be required to file an Officer’s List (previously filed with franchise return)?

This is currently being discussed. More information will be available at a future date.

My corporation is suspended for non-compliance in a prior year. How will this be handled now?

For tax years 2023 and prior, compliance is still mandatory. An entity that was suspended for non-compliance will remain suspended until the issue is resolved. Upon fully satisfying the problem, the entity will be re-instated.

Will I continue to be required to complete Form 200-F if I elect to file the annual franchise tax using the same period and due date as my corporate income tax filing year?

Any taxpayer wishing to make an election to file the annual franchise tax using the same period and due date as the corporate income tax filing year must have filed the election using a Form 200-F on or before July 1, 2023. No additional elections will be accepted going forward.

Form 513 and 513NR are due April 15th or the 15th day of the fourth month following the end of the fiscal year.

While the OTC cannot move the filing deadline, fiduciaries who file on or before June 15, 2021 for tax year 2020 will not be penalized for late filing. Therefore, if you don't think you can file & pay by June 15, you should file for an extension. Use this link for more information.

A listing of tax exempt bonds is available for federal and state bonds.

You may request an extension of time to file your Oklahoma income tax return. If you have a valid extension of time to file your federal return and no Oklahoma tax is owed, your federal extension automatically extends the due date of your Oklahoma return. A copy of the federal extension must be enclosed with your Oklahoma return. If your federal return is not extended or an Oklahoma tax is owed, an extension of time to file your Oklahoma return can be granted on Form 504-C. Oklahoma wage withholding is reported on Form WTH10001. For current Oklahoma tax forms, visit the Forms page. Keep in mind that an extension of time to file is not an extension of time to pay the tax. An extension is valid only when 90% of the tax is paid by the original due date of the tax return.

When you file your return, pay what you can with the return. You will receive a bill for the remaining tax, penalty and interest. If you would like to make other arrangements, please contact our Collections Division at 405.521.2212. There will be a one-time delinquent penalty of 5% and interest accruing at 1.25% per month on any tax not paid by the original due date.

Franchise tax is due each year on May 1st for max filers and July 1st for non-max filers, unless the corporation has elected to change its filing period to match their corporation’s fiscal year. This election must have been made prior to July 1st, 2023. If a corporation makes an extension for the purpose of filing their income tax, the filing period for franchise tax is also extended. However, as with income tax, this does not extend the due date for payment of the franchise tax.

While the OTC cannot move the filing deadline, taxpayers who file on or before June 15, 2021 for tax year 2020 will not be penalized for late filing. Therefore, if you don't think you can file & pay by June 15, you should file for an extension. Use this link for more information.

A penalty of 10% of the tax due along with interest accruing at the rate of 1.25% per month is assessed if the franchise tax is not remitted by September 15th. For those corporations that have elected to file on a different fiscal year, penalty and interest will begin to accrue on the 15th day of the third month following the close of their fiscal year. For example, a filer would be assessed penalty and interest starting on March 15th if they have a year end of December 31st.

The OTC can issue a letter of good standing upon verification that the corporation is in compliance with franchise tax filings, payments and registered agents fees.

A corporation can be reinstated upon verification that all required franchise tax filings, payments and registered agents’ fees are current. In addition, a one-time $150.00 reinstatement fee is required.

Instructions for consolidated returns can be found in the 512 Packet. For current Oklahoma tax forms, visit the Forms page.

Yes, paper returns are still accepted. A total prohibition on the submission of paper returns has not been implemented. There is no procedure for advance exemption from electronic filing. Returns should be submitted in a timely fashion by the best means possible.

Additional guidance regarding electronic filing requirements will be provided as it becomes available.

You are required to make quarterly estimated tax payments, if you can reasonably expect your tax liability to exceed the amount withheld by $500.00 or more and you expect your withholding to be less than the smaller of 70% of your current year's liability or the tax liability shown on your return for the preceding taxable year of twelve months. Taxpayers who fail to pay estimated tax payments may be subject to interest on the amount underpaid. Use Form OW-8-ESC for filing estimated tax payments. For current Oklahoma tax forms, visit the Forms page.

If at least 66% or two-thirds of your gross income for this year or last year is from farming, estimated tax payments are not required.

The deductibility of the “Qualified Business Income Deduction”, which is reported on federal Form 1041, is an allowable deduction for Oklahoma.

For Oklahoma, the 20% pass through deduction is a modification to federal taxable income. As such, the “Qualified Business Income Deduction” attributable to Oklahoma business income retained by the trust is allowed as a deduction on Form 513, Line 18, Column B and as a deduction on Form 513NR, Line 22. Any deduction attributable to the income distribution deduction will be determined by the beneficiary. For current Oklahoma tax forms, visit the Forms page.

The starting point for computing Oklahoma taxable income is Federal taxable income.  Oklahoma tax treatment will follow the Internal Revenue Code, except when the Oklahoma Income Tax Act specifically provides otherwise.  The Oklahoma Income Tax Act does not specifically provide otherwise for the treatment of the Paycheck Protection Program for loan forgiveness and related expenses. 

Oklahoma follows the Internal Revenue Code treatment of the Paycheck Protection Program for loan forgiveness and related expenses. 

If an election is made to file a combined franchise and corporate return the franchise tax is due on the same date as the corporate income tax is due. There is no extension to September 15th for the payment of franchise tax.

If a corporation makes an extension for the purpose of filing their income tax, the filing period for franchise tax is also extended. However, as with income tax, this does not extend the due date for payment of the franchise tax.

The due date is July 1st and the payment is considered delinquent after September 15th.

Effective August 30, 2024, the sale of "food and food ingredients" and certain "prepared food" will be exempt from state sales and use tax. The sale of prepared food, alcoholic beverages and dietary supplements are subject to the full state sales and use tax rate of 4.5%.  

The exemption for food and food ingredients, and certain prepared food, applies only to the state portion of the sales tax rate. All local sales and use taxes still apply. [House Bill 1955 (2024) and Senate Bill 1283 (2024)]

Food and food ingredients are generally considered “grocery store food items,” especially foods made and packaged by a manufacturer or processor and fresh, raw food which may be purchased from a bulk vendor or from a local seller, such as a farmers market. Food and food ingredients do not include alcoholic beverages, dietary supplements or prepared food.

Prepared food is food intended for, and is generally ready for, immediate consumption, either on or off the premises of the seller. To be considered prepared food, the legal entity that sells the product at retail must do an activity in addition to selling the item: heat, mix or provide utensils.

Yes. There are some items of prepared food that are exceptions to the rule and are exempt from state sales tax.

1. Food that contains raw eggs, fish, meat or poultry products that requires cooking after the sale to prevent food-borne illnesses and food the customer generally cooks or heats after the sale. 

Example: A butcher shop or meat market sells raw steaks. Because the steaks require cooking by the consumer as recommended by the Food and Drug Administration, so as to prevent food borne illnesses, the steaks are not prepared food.

2. Food that is only cut, repackaged or pasteurized by the seller.  

Example: Meat from a deli counter that is sliced and wrapped for a customer, or fruit sliced by the seller and packaged into containers or onto platters for sale.

3. Food sold in an unheated state by weight or volume as a single item and eating utensils are not provided by the seller.  

Example: A deli prepares potato salad in bulk quantities. It sells the potato salad by the weight requested by each purchaser, placing that amount in a container sized to accommodate the chosen weight. If eating utensils are not provided by the deli, the potato salad is exempt from state sales tax because it is sold at a variable unit price determined by weight. 

Example: A deli prepares potato salad in bulk quantities. It packages the potato salad in uniform containers, but the containers are priced for sale according to the weight of each individual container. If eating utensils are not provided by the deli, the potato salad is exempt from state sales tax because it is sold for a variable unit price determined by the weight of each individual container.  

Example: A deli prepares potato salad in bulk quantities. It packages the potato salad in uniform containers which are sold at a standard price per container. Although the potato salad is not heated, and eating utensils are not provided by the deli, the potato salad is not exempt from state sales tax because it is sold for a standard unit price per container and not for a variable unit price determined by the weight of each individual container.

4. Food items prepared and produced by a third-party food manufacturer or processor are generally considered to be food and food ingredients when sold by a retailer to a final consumer. 

Example: Cereals, canned vegetables and dairy products.

5. Prepared food that ordinarily requires cooking (as opposed to just reheating) and is sold without eating utensils is taxed at the reduced state sales tax rate.  

Example: At a specialty store, a customer purchases a take-and-bake pizza (made with precooked meat and no eggs). If eating utensils are not provided by the specialty store, the take-and-bake pizza is exempt from state sales tax rate because it requires cooking.

Milk, soft drinks in a bottle or can, baby food, fruits and vegetables, potato chips, fish and meats, herbs and spices, frozen meals, pasta, and flour. Additional examples of common food items purchased at your local grocery that are exempt from state sales tax are in the Oklahoma Product Guide.

Alcoholic beverages, beer, dietary supplements, self-serve fountain drinks, rotisserie chicken, pet food, vitamins, toiletries, over-the-counter medications and food made by the seller (e.g., birthday cakes, sushi, sandwiches, deli and salad). Additional examples of common food items purchased at your local grocery and not exempt from state sales tax rate are in the Oklahoma Product Guide.

No. The sale of food and food ingredients will continue to be subject to local sales tax.

Food purchased at restaurants is considered “prepared food” and is still subject to state sales tax, in addition to any locally levied sales tax. 

If a seller’s prepared food sales are greater than 75% of total sales of food items, and utensils are made available to the purchaser receiving the food, then all food items sold by the seller are considered prepared food and are not exempt from state sales tax.

An eating utensil is a useful tool or instrument used in the consumption of food, including bowls, chopsticks, cups, forks, glasses, knives, napkins, plates designed for serving food, skewers inserted into food and handed to the customer, spoons or straws. Material used solely to package and transport food does not qualify as an eating utensil.

To determine when an item is considered “prepared food” and is subject to state sales tax, sellers should ask themselves the following questions:

Step 1.
Do I make utensils generally available to my customers and is my percentage sales of prepared food greater than 75%?  

If the answer to both parts of this question is “yes,” state sales tax must be collected on all sales of food and food ingredients. The only exception is for items containing four servings or more, packaged for sale as a single item and sold for a single price, not made or heated by the seller and where the seller makes available eating utensils necessary for the purchaser to receive the food. (See FAQ "What is the exception to the 75% rule?")

If the answer is no to either part of the question, separately evaluate the taxability of each item sold in accordance with Steps 2 through 5 below.  

Step 2.
Is a plate, glass, cup or bowl necessary to receive the item or is my customary practice to deliver a utensil for the item to the customer as part of the sales transaction? 

If the answer to either part of this question is “yes,” the sale is not exempt from state sales tax.  

If the answer to both parts of this question is “no,” move to Step 3. 

Step 3.
Am I heating the item or selling it in a heated state?  

If the answer is “yes,” the sale is not exempt from state sales tax. 

If the answer is “no,” move to Step 4.  

Step 4.
Did I mix or combine two or more ingredients to sell as a single item? 

If the answer is “no,” the sale is exempt from state sales tax.  

If the answer is “yes,” move to Step 5. 

Step 5.
Ask yourself the following four questions:  

1. Did I only cut, repackage or pasteurize the product? 

2. Is the food sold in an unheated state by weight or volume as a single item and did I not provide eating utensils? 

3. Am I a food manufacturer under NAICS, Sector 311, other than a bakery (subsector 3118)? 

4. Does the product contain raw eggs, fish, meat or poultry that requires cooking by the consumer as recommended by the FDA to prevent food borne illness?  

If the answer to any one of these four questions is “yes,” the sale is exempt from state sales tax. 

If the answer to all four of these questions is “no,” the sale is not exempt from state sales tax. 

If you make an exempt sale of food and food ingredients that is also exempt pursuant to one of the itemized exemptions in Section J. SALES TAX EXEMPTION SCHEDULE, lines 3a through 3x on the Oklahoma Sales Tax Return, record the amount of exempted sales in Section J. In the example set out above, you would record the amount of exempted sales on line 3j. Sales to qualified veterans on the Oklahoma Sales Tax Return. Do not include the amount of exempted sales to qualified veterans on line 4. Total eligible food and food ingredient sales.

Yes. The sale of food and food ingredients continue to be subject to local sales tax.

Yes. Food and food ingredients include candy and is exempt from state sales tax. 

A dietary supplement is a product that provides nutrients or other compounds to increase what you get from your normal diet. It is not regular food and is not meant to be a full meal. Dietary supplements come in forms like tablets, capsules, powders and liquids. They contain ingredients like vitamins, minerals, herbs, amino acids, or extracts from plants. The product's label will have a "Supplement Facts" box that identifies it as a dietary supplement.

All sellers with prepared food sales greater than 75% of their total food sales are required to collect sales tax on all food sales, with the exception of sales of packages containing four or more servings. (See FAQ "What is the exception to the 75% rule?")

The formula for calculating the total sales percentage is the sum of gross sales of heated food, mixed/combined food and food sold in such a way that a plate, glass, cup or bowl is necessary to receive the food divided by gross sales of all food and food ingredients (including all prepared food and dietary supplements).

You are required to maintain records to support the calculation of the 75% rule. Your sales receipts must also segregate taxable and state-tax-exempt sales. You will indicate on your Oklahoma sales tax return that your prepared food sales exceed 75% of your total food sales by marking the appropriate box on the return.  

The sales tax return will have a check-box that must be checked yes or no to indicate if you are a 75% business.

Even if more than 75% of food sales are sales of prepared food, sales of food or food ingredients will be exempt from state sales tax if:

• The food item contains four or more servings packaged as one item for a single price;  

• Has not been made or heated by the seller, and 

• Utensils are not provided by the seller.  

To determine the number of servings in the food item, use the information on the product label. If there is no product label, make a reasonable determination as to the number of servings in the food item.  

Collect and report state sales tax on food and food ingredients for August 1-29, then adjust tax collection and reporting to stop collecting the state portion of the sales tax on the food and food ingredients subject to the reduced rate.

If the vendor’s electronic system will not support a programming change, the sales will need to be records manually for August 30 and 31.  

No, businesses are required to compile with the reduced rate as of the effective date of the legislation August 30, 2024. Any preparation for the change must be completed prior to the effective date of the legislation.  

• Oklahoma Product Guide
• Oklahoma Tax Commission Rules on Food and Food Ingredients
• Oklahoma Sales and Use Tax Guide for Food & Food Ingredients and Prepared Food

Dispensaries are required to obtain an OTC sales/medical marijuana tax permit. To apply for an account go to OkTAP and select the “Register” link, then select “Register a Business”. Complete the registration as directed.

Sales tax is due on the 20^th of each month and can be filed on OkTAP. Only cash payments are accepted for these transactions.

In addition to obtaining an OTC sales and medical marijuana permit, dispensary owners must also obtain a commercial entity license issued by the Oklahoma Medical Marijuna Authority (OMMA).

The medical marijuana tax is calculated at 7% of the total gross receipts from medical marijuana sales. This tax is reported on the medical marijuana return. Sales tax is reported on the sales tax return, sales tax is based on the location of the store.

A disabled veteran is exempt from sales tax; however, they are not exempt from the medical marijuana excise tax of 7%.

You can pay medical marijuana business tax online through your OkTAP account or in-person at the OTC Taxpayer Resource Center or any BancFirst lobby. More information about in-person MMJ tax payments.

Starting a new business may require you to register with the OTC or a different state, city or county agency. The following steps can help:

• Complete the business registration application for the permits and/or accounts you need.
• Contact the secretary of state if you intend to incorporate your business.
• Apply to the Oklahoma Employment Security Commission to register for unemployment insurance taxes.

Nonresident Contractors in addition must contact Oklahoma Department of Labor, Worker Compensation Division 405.528.1500 and county assessor’s office of the county in which the work is to be done.

You may apply for a sales tax permit by filing and completing a business registration application on OkTAP.

The business registration application is used to apply for permits and accounts as you need them. You may complete another application when you hire employees.

View our New Business Video Series.

A tax compliance officer will attempt to contact you during your first 6 months of doing business. The primary goals of the agent are to verify you have all your permits or accounts needed to do business. They will attempt to answer any questions you may have and will assist you with online filing.

Yes, you can register online on OkTAP.

Notify us when either a change in location or mailing address occurs. You may provide that information by completing OTC Form BT-115-C-W Notification of Business Address Change and mail to:

Oklahoma Tax Commission

Post Office Box 26800

Oklahoma City, OK 73126-0920

For current Oklahoma tax forms, visit the Forms page.

Pursuant to 68 O.S. Section 1392, any seller without physical presence in Oklahoma who made more than $100,000 in Oklahoma taxable sales in the preceding or current calendar year is required to register and collect Oklahoma and local sales taxes on sales delivered or sourced to an Oklahoma address.

A remote seller is generally any seller making sales of taxable products or services into Oklahoma who does not have a physical presence in Oklahoma.

Yes.  A marketplace facilitator that had aggregate sales of products in Oklahoma or delivered to locations in Oklahoma subject to sales or use tax worth at least $10,000 during the immediately preceding 12 month period must file an election with the OTC to either collect and remit the tax or to comply with certain notice and reporting requirements. 

For purposes of registration, the type of tax to be collected and remitted depends upon the location of the marketplace facilitator. A marketplace facilitator located in Oklahoma will register for, collect, and remit Oklahoma sales tax. A marketplace facilitator located outside of Oklahoma will collect and remit Oklahoma vendor use tax. The location of a marketplace seller who is selling through the marketplace facilitator’s platform does not affect the type of tax to be collected and remitted.

A "marketplace facilitator" means a person that facilitates the sale at retail of a marketplace seller's product.

Yes. Remote sellers are only required to obtain a sales tax permit from OTC and collect Oklahoma state and local sales tax if they have more than $100,000 in taxable Oklahoma sales in the preceding calendar year or current calendar year for delivery into the state.

Marketplace facilitators are only required to either obtain a sales tax permit from OTC and collect Oklahoma state and local sales tax or comply with the notice and reporting requirements set out in 68 O.S. Section 1393 if they have more than $10,000 in taxable Oklahoma sales in the immediately preceding 12 month period for delivery into the state.

However, these sellers may still volunteer to register and collect the tax in this state as a benefit to their Oklahoma customers.

The small seller exception does not apply to sellers who have a physical presence in Oklahoma.

To register a new business and obtain a sales tax permit, access the Oklahoma Tax Commission's Online Business Registration System, a part of OkTAP (the Oklahoma Taxpayer Access Point) web portal at www.tax.ok.gov.  Or businesses can register with Oklahoma and 23 other states that are part of Streamlined Sales Tax through the Streamlined Sales Tax Registration System.

Oklahoma’s state sales and use tax rate is 4.5%. Local taxes may also apply. Except for the sale of residential utilities and certain food and food ingredients, local taxes apply to the same taxable items and services as the Oklahoma state sales tax rate.

You may want to contact your current software vendor that you use for sales and use tax. Sellers that register with Streamlined Sales Tax may qualify for free sales tax calculation and reporting services. To learn more, see information related to Certified Service Providers at: streamlinedsalestax.org.

After South Dakota v. Wayfair, if you are making sales of property or services into other states, you may have an obligation to collect and remit those states’ sales taxes. Review each state’s remote seller threshold chart and check with each state to determine if you are required to register in that state. You can register with 23 other states using the Streamlined Sales Tax Registration System (SSTRS) registration form, which is available at: sstregister.org. If you are licensed to collect and remit tax in Oklahoma, you should continue doing so

No. While Oklahoma's sales tax levy currently imposes sales tax on sales/rentals of tangible personal property, certain enumerated services such as telecommunications and other transactions including sales of admissions and lodging, no new services have been added to the sales tax levy pursuant to Senate Bill 1339 or any other measure enacted in 2022.

Senate Bill 1339 expanded the definition of “marketplace facilitator” to mean a person that facilitates the sale at retail of a marketplace seller’s product, defined as tangible personal property, services, or other transactions currently taxable under the Oklahoma Sales Tax Code. Marketplace facilitators making sales of Oklahoma lodging may now be required to collect and remit state and local taxes.

For hotels making sales of lodging in Oklahoma through their website and through a marketplace facilitator, the hotel will report and remit the gross receipts and corresponding tax related to its direct sales to customers in Oklahoma to the Tax Commission. The sales made through a marketplace facilitator should be recorded on the hotel’s sales tax report in Part J. Sales Tax Exemption Schedule on either line 3w “Marketplace Facilitator” or 3x “Other legal sales tax exemptions” and in the box marked "Explain" indicate the name of the marketplace facilitator.

The Pass–Through Entity Act of 2019 provides that an “electing pass–through entity (PTE)” means any pass–through entity including a general partnership, a limited partnership, a limited liability partnership, a limited liability limited partnership, a limited liability company or a corporation that is required to file an Oklahoma partnership income tax return or an Oklahoma S corporation income tax return.

Visit OkTAP to search current PTE elections.

The election must be submitted separately on Form 586 or via OkTAP no later than two months and 15 days after the beginning of the PTE's taxable year to be effective. Alternatively, beginning with tax year 2024, the election may be made with the timely filed income tax return (extensions included) by including Form 586 with your return submission.

Yes, but to be effective for the current taxable year, the revocation must be made no later than two months and 15 days after the beginning of the PTE's taxable year. Revocations received outside of this timeframe will be effective for the subsequent taxable year. The election is binding on all partners\members\shareholders of the electing PTE.

Note: Revocations must be submitted separately on Form 586. No revocation is allowed with the submission of your income tax return.

Tax credits generated by an electing PTE stay at the entity level and may not be allocated to shareholders, partners or members.

The electing PTE is not required to file Form 512–SA because the nonresident shareholder will not be required to file an Oklahoma income tax return on the nonresident shareholder’s share of distributable income of the PTE. For current Oklahoma tax forms, select the Forms tab in the top menu bar.

The electing PTE is not required to withhold tax from distributions made to nonresident partners, members or shareholders because the PTE elected to pay the income tax on the Oklahoma portion of the distributions at the entity level.

An electing PTE may claim the Oklahoma capital gain deduction. The capital gain deduction is not dependent on the members’ ownership term, only on the PTE’s ownership of the asset.

New forms will be available to make payments beginning in 2025.

Form OW-8-ESPTE may be used for estimated tax payments for tax year 2025 and forward.

Form 504-PTE may be used to submit an extension of time to file tax year 2024 income tax returns and forward.

Form EF-PTE may be used to submit separate payment of the balance due reported on the 2024 income tax return and forward.

Note: Electronic payments are required to be submitted for your income tax account. Payments are not required for pass-through withholding for an electing PTE.

Net Entity Losses may only be utilized in years of Net Entity Income with a valid PTE election in the same manner as net operating losses allowed for federal carry back or carry forward. No pass through or distribution of net entity loss is allowed. Losses sustained in years without an election are applied to the taxable income of the owner.

The election is exclusive to the entity elected. The election of one PTE cannot be applied to another PTE. A survivor company after reorganization must submit an election on its own behalf.

Pass-through withholding (WTP) is money that is required to be withheld by a pass-through entity on the Oklahoma portion of distributions paid to its nonresident members.

Pass-through withholding is not required for members of an electing PTE under this provision. Do not submit payments for in-lieu tax with PTE elections to your WTP account. See the FAQs for more information about pass-through entities.

A pass-through entity must withhold on distributions to all individual nonresident members, unless the pass-through entity has received a completed Form OW-15 from the nonresident member at the time of distribution. Form OW-15 is an affidavit that is legal and binding until the member revokes the affidavit.

On an annual basis, the pass-through entity should use Form OW-15-A Transmittal of Nonresident Member Withholding Exemption Affidavit to compile and submit all OW-15 forms received during the year to Oklahoma Tax Commission.

A pass-through entity that withholds on distributions to its members is required to submit Form 500-B Information Return Report of Nonresident Member Income Tax Withheld, reflecting the amounts withheld from the member’s distributable income. On an annual basis, the pass-through entity should use Form 501 Annual Information Return Summary of Reports Enclosed Herewith to compile and submit the 500-B forms to the Oklahoma Tax Commission. Attachment of Form 501 and 500-B's to the entity's income tax return is not valid for this submission.

If a pass-through entity receives income that has already been subject to previous withholding, the pass-through entity is not required to withhold from the income again or report the withholding on Forms WTP-10003 or 500-B. Withholding on amounts received by the pass-through entity is a distributable item to be allocated to members on the pass-through entity’s income tax return.

A pass-through entity must use Form WTP-10003 Oklahoma Nonresident Distributed Income Withholding Tax Annual Return to report and remit amounts withheld from nonresident members to the OTC no later than the due date of the pass-through entity’s income tax return including extensions.

If a pass-through entity expects to pay in excess of $500.00 to the OTC, the pass-through entity should use Form WTP-10005 Oklahoma Nonresident Distributed Income Estimated Withholding Tax Report to make quarterly estimated payments to avoid underpayment of estimated withholding interest and penalty. If a pass-through entity is required and fails to properly make quarterly estimated payments, interest and penalty owed can be calculated using Form OW-9-P.

Note: Do not pay estimated withholding if a loss or no distribution to members is anticipated.

A pass-through entity withholds on behalf of its members. Amounts paid to the OTC for withholding are held in trust for the benefit of the member and can only be claimed for the benefit of the member.

EXAMPLE 1:

In this example, three equal members received a cash distribution of $30,000.00 from an out-of-state PTE that does part of its business in Oklahoma and receives Oklahoma royalty income.

EXAMPLE 2:

In this example, the amount withheld from Member 2 exceeds the amount required.