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Minnesota
Sales and
Use Tax
Instruction Booklet
Revised December 2014
Inside this booklet
Who needs to register?
Minnesota state and local
sales and use taxes
Need help with your taxes?
We’re ready to answer your questions!
Phone:
651-296-6181
or 1-800-657-3777
E-mail:
[email protected]
What’s taxable?
What’s not taxable?
Fact sheets
General filing information
Preparing to file your return
Filing electronically
Requesting a refund
Amending a return
600 North Robert Street, St. Paul, MN 55146-6330
Hours: 7:30 a.m. – 5:00 p.m. Monday through Friday
Information in this booklet is available in other formats upon
request for persons with disabilities.
File your return and pay tax electronically and subscribe to
receive email updates regarding sales and use taxes at
www.revenue.state.mn.us
1
Who needs to register?
You must register to collect sales tax if you
make taxable retail sales in Minnesota. This
includes sellers outside Minnesota who:
• have an office; distribution, sales, or
sample room location; warehouse or
other place of business in Minnesota,
either directly or by a subsidiary;
• have a representative, agent, salesperson,
canvasser, or solicitor in Minnesota, on
either a permanent or temporary basis,
who operates under the authority of the
retailer or its subsidiary for any purpose,
such as repairing, selling, delivering, installing, soliciting orders for the retailer’s
goods or services, or leasing tangible
items in Minnesota;
• deliver items into Minnesota in their own
vehicles;
• provide taxable services in Minnesota; or
• have entered into an agreement with a
solicitor for the referral of Minnesota
customers for a commission and your
gross receipts over 12 months is at least
$10,000.
See Revenue Notice #00-10, Sales and Use
Tax – Nexus Standards, for criteria on
determining when an out-of-state retailer is
required to register, collect and remit Minnesota sales or use tax on sales made into
Minnesota.
If you make retail sales in any cities, counties or other local taxing areas that have
a local sales tax, you must also register to
collect those local taxes (see Fact Sheet 164,
Local Sales and Use Taxes, for a listing of
local taxes; also see Fact Sheets 164M, Minneapolis Special Local Taxes, and 164S, Special Local Taxes: Detroit Lakes, Giants Ridge,
Mankato, Rochester, St. Cloud, St. Paul).
If you sell only nontaxable items, you do not
need to register for sales tax.
If you do not make taxable sales, but make
purchases subject to use tax, you must register to remit use tax. The department may
automatically register you for use tax filing
if you register for withholding tax. See the
section “Minnesota state and local sales and
use taxes” on page 3 for more information
about use tax.
It is against the law to make taxable retail
sales or provide taxable services in Minnesota without being registered.
Affiliate nexus. Affiliates of Minnesota
businesses are required to collect and remit
Minnesota sales tax on sales made into
Minnesota. An entity is an affiliate of a
Minnesota business if the related entity
promotes the affiliate’s business or provides
services to the out-of-state entity and the
retailer and entity are related parties. A retailer and entity are related parties if at least
one of the following is true:
• one of the parties owns directly or
indirectly at least 50 percent of the other
party’s outstanding stock;
• one of the parties is a partnership, estate
or trust that owns directly or indirectly
at least 50 percent of the capital, stock, or
value of the other party; or
• an individual stockholder or the stockholder’s family owns directly or indirectly at least 50 percent of the value of
outstanding stock of both entities.
For example, if two entities are related and
the in-state entity advertises, promotes or
facilitates the establishment or maintenance
of a market in Minnesota for an out-of-state
seller, the in-state entity creates nexus for
the out-of-state seller.
In addition, if the in-state entity provides
services to the out-of-state seller (such as
accepting returns from the seller’s customers, resolving complaints from the seller’s
customers, etc.), the in-state entity also creates nexus for the out-of-state seller.
How to register or report
business changes
You may register for a Minnesota tax ID
number online at: www.revenue.state.mn.us
or by calling 651-282-5225 or 1-800-6573605.
You must notify us if you:
• change your legal organization (from
individual to partnership or LLC, partnership to corporation, etc.).
• add or close a location.
• begin making sales in a city, county
or area with a local tax (see Fact Sheet
164, Local Sales and Use Taxes, for a listing of local taxes). If you file your return
on the Internet, you can add a local tax
when filing. If you file by phone, you
must call our office to add a local tax.
• are in a locality that imposes a new local
sales and use tax. (We will generally
add the new local tax.)
2
• begin selling a product or service that
is reported separately such as liquor
(on or off-sale), car rentals, waste hauling
services, etc. If you file your return on
the Internet, you can add these tax types
when filing. If you file by phone, you
must call our office to add them.
• find your taxable sales have increased so
that you are required to file more often
(see “General filing information” on page
12).
• close your business.
Notifying us of significant changes in the
structure or location of your business will
help you avoid tax bills and periods of noncompliance. If you have a Minnesota tax ID,
you can make some changes online, or you
can call our office.
Multiple locations
If you operate your business from more
than one permanent physical location, you
may hold a single ID number and file one
consolidated tax return for all locations or
choose to apply for separate Minnesota tax
ID numbers and file separate tax returns for
each location.
Examples of separate physical locations:
• permanent storefronts where retail sales
are made.
• kiosks in a mall.
The following are not separate physical
locations:
• sales at craft shows (unless the location is
permanent).
• vending machines at multiple locations.
• services performed at various locations,
such as a janitorial service or a landscaper.
• doing business from a vehicle that moves
from place to place.
Operators of selling events
Before an operator of a county fair, craft
show, art fair, flea market, trade show, or
similar selling event can rent space to a person to sell at the event, the operator must
have written documentation from the seller
that they hold a valid sales tax registration,
or a written statement from the seller that
no taxable items are being sold. Form ST19,
Operator Certificate of Compliance, is available for this purpose. You can find this form
on our website at www.revenue.state.mn.us.
Continued
Who needs to register? (continued)
Anyone who pays to sell at such an event
is considered to be in business and must
collect sales tax on all retail sales of taxable
items unless they qualify for the “occasional
sales” exemption described below.
• The seller makes sales of $500 or less during the calendar year; and
• The seller provides a written statement to
that effect, and includes the seller’s name,
address and telephone number.
Occasional sales exemptions applicable at
flea markets and similar events.
The law allows a seller at a flea market or
other similar event to qualify for the occasional sales exemption if all of the following
criteria are met:
An organizer can accept a written statement
from sellers who make occasional sales indicating that they meet the above-mentioned
criteria. This exemption does not apply to
sales made by a business.
• The seller participates in only one event
per calendar year that lasts no more than
three days;
Penalty. Operators who do not have Form
ST19 or a similar written statement from
sellers can be fined $100 for each seller that
is not in compliance for each day of the
selling event.
Receive electronic updates
Subscribe to receive sales and use tax
notices electronically, including updates
to sales and use tax law changes, rules,
fact sheets, and other related sales and
use tax information.
To subscribe to receive free email
updates, go to our website at
www.revenue.state.mn.us and complete
the requested information. You will
receive an email to which you must reply
before you can receive updates.
Minnesota state and local sales and use
taxes
Sales tax
Minnesota has a 6.875 percent general sales
tax rate. (The rate increased from 6.5 percent to 6.875 percent, effective July 1, 2009.)
The sales tax applies to retail sales of taxable
services and/or tangible personal property
made in Minnesota. Businesses collect the
sales tax due on items and services sold at
retail on behalf of the state. For details, see
“Retail sales” on this page and “What’s taxable?” beginning on page 5.
Sales tax may either be added separately to
the selling price or included in the selling
price. If the tax is included in the selling
price, the item must be marked “tax included” or a sign posted indicating that tax
is included. M.S. 297A.77, subd 1
Retail sales
Most retail sales are taxable in Minnesota. A
“retail sale” means any sale, lease or rental of
tangible personal property for any purpose
other than resale, sublease or subrent. A
retail sale also includes services for any
purposes other than for resale.
Sales, leases and rentals are taxable regardless of quantity or whether the item is new
or used, unless an exemption applies. Some
services are also taxable.
Use tax
If you buy a taxable item for your own use
without paying sales tax, you probably owe
use tax. The tax rate is the same for both
sales and use tax, and the same exemp-
tions apply. Use tax is due on taxable items
and services used in Minnesota if no sales
tax was paid at the time of purchase. The
general use tax rate is the same as the state’s
general sales tax rate, 6.875 percent. All general local sales taxes also have a corresponding use tax, which is at the same rate as the
local sales tax.
Keep track of your purchases subject to
use tax and report them when you report
your sales tax. Also, keep a record of the
purchases on which you paid use tax, noting
the date reported and paid.
While sales tax is collected by the seller
and paid to the state by the seller, use tax is
self-assessed and paid by the purchaser (end
user). The purchaser pays the tax directly to
the state.
Individuals as well as businesses owe use
tax on taxable purchases when they have
not paid sales tax. An individual, however,
can purchase up to $770 in taxable items
for personal use without owing use tax. If
the individual buys more than $770 in a
calendar year, that person owes use tax on
all taxable items purchased that year.
Here are some cases when use tax is due:
• You buy taxable items by mail order, from
a shopping channel, over the Internet,
etc., and the seller doesn’t collect Minnesota tax from you.
• You buy something exempt intending
to resell it in your business, but instead
take it out of inventory for business or
personal use.
• A seller in another state or country does
not collect any sales tax from you on a
sale of an item that is taxed by Minnesota’s law.
• A Minnesota seller fails to collect sales
tax from you on a taxable item.
• An out-of-state seller properly collects
another state’s sales tax at a rate lower
than Minnesota’s. In this case, you owe
the difference between the two rates.
3
If you are located in an area that has local
taxes, be sure to also report the local use tax
due.
Individuals who owe use tax, but are not
required to hold a sales tax permit, can file
a use tax return annually, regardless of the
total amount of purchases. These returns are
due by April 15 of the following year. To file
the return and pay tax electronically, go to
our website at www.revenue.state.mn.us and
login. Enter your Social Security number,
select “Individual use tax” and follow the
steps until you receive a confirmation
number.
You may also download Form UT1, Individual Use Tax Return, from our website, or
contact our office for a copy.
For more information, see Fact Sheets 146,
Use Tax for Businesses; and 156, Use Tax for
Individuals.
Continued
Minnesota state and local taxes (continued)
Local taxes
We currently administer and collect several
local sales and use taxes. The general local
taxes apply to the same items that are taxed
by the Minnesota sales and use tax law. You
must be registered for any locality with a local tax if you do business there.
To figure the tax, combine the state tax rate
and all applicable local rates. Apply the total
combined rate to the taxable sales price and
round to the nearest full cent. (Rate charts
are available on our website.)
Local taxes are reported at the same time
you report your Minnesota sales and use tax,
but the taxable sales for each locality are reported separately. You must be registered for
each local tax you report. Call our office to
register for local taxes if you file by phone. If
you file by Internet, please add the applicable
local taxes when you file your return.
A map of the various rates that apply in the
seven-county metropolitan area is shown at
right. Several localities outside the metropolitan area also impose local taxes.
For more information about local taxes and
an up-to-date list of localities that have local tax, see Fact Sheets 164, Local Sales and
Use Taxes; 164M, Minneapolis Special Local
Taxes, and 164S, Special Local Taxes: Detroit
Lakes, Giants Ridge, Mankato, Rochester, St.
Cloud, St. Paul.
Rate charts
• For trade-ins, charge sales tax on the difference between the price of the item you
are selling and the trade-in allowance.
The item traded must be a taxable item
and something you normally sell in your
business. Otherwise, tax is due on the full
price of each item.
• Do not charge sales tax on interest,
financing and carrying charges on credit
sales if they are separately stated on the
customer’s bill.
• Charge sales tax on shipping, handling
and installation charges for taxable items.
• Charge sales tax on the total price of any
taxable services. Do not deduct the cost
of materials and supplies you used to
provide the service.
• Deduct cash discounts, trade discounts or
quantity discounts you give at the time of
sale.
• When honoring one of your own coupons, subtract the coupon amount first,
then charge sales tax on the remaining
amount. Handle “two-for-one” and similar coupons the same way.
• When honoring a manufacturer’s coupon,
charge sales tax first, then subtract the
coupon amount.
• Gift certificates are treated the same as
cash. Charge sales tax, then subtract the
gift certificate amount.
List the sales tax separately from the sales
price for your customer whenever practical. You can include the tax in the selling
price; however, you then must publicly post
a notice that states that the price includes all
applicable sales tax or state on the invoice
that tax is included.
Twin Cities Metro Area Sales and Use Tax Rates
The sales and use tax rates
for the Twin Cities metropolitan area range from 6.875
percent (Carver and Scott
counties) to 7.775 percent in
Minneapolis.
Rate charts are available at the following percentages. Download them from our website
or call our office to request copies.
State rate - 6.875 percent
Various combinations of state and local tax:
6.875%
9.125%
10.775%
7.025%
9.375%
13.025%
7.125%
9.525%
13.275%
7.275%
9.625%
13.400%
7.375%
9.775%
13.525%
7.525%
9.875%
13.775%
7.625%
10.025%
16.025%
7.775%
10.125%
16.275%
7.875%
10.275%
8.875%
10.525%
The sales tax rate for sales (not leases) of
motor vehicles remains at 6.5 percent. A 6.5
percent rate chart is also available on our
website.
Figuring the tax
The following guidelines will help you
determine the sales price on which the tax is
charged.
• Deduct federal excise tax imposed directly
on the customer if it is separately stated on
the customer’s bill.
* Minneapolis includes 6.875% state sales tax,
0.5% Minneapolis local sales tax, 0.15% Hennepin
County sales tax, and the 0.25% transit improvement sales tax.
St. Paul includes 6.875% state sales tax, 0.5% St. Paul local sales tax, and the
0.25% transit improvement sales tax.
4
What’s taxable?
Sales and purchases of
tangible personal property
and certain services are
subject to Minnesota sales
and use tax.
(For applicable laws, see Minnesota
Statutes, Chapters 297A and 297B, at
www.leg.state.mn.us.)
Examples of taxable sales
in Minnesota
Admission and amusement fees.
Fees to access health clubs, amusement
devices, tanning facilities, spas, athletic
facilities, golf clubs, ski hills, recreational
areas (campgrounds, parks, trails, picnic
grounds), movies, etc., are taxable. Onetime initiation fees and membership dues to
athletic clubs are also taxed. Fact Sheets 124,
Exercise Facilities and Health Clubs; and
123, Athletic Facilities, Recreational Areas,
Resorts and Campgrounds.
Aircraft. Fact Sheet 101, Aircraft.
Building materials, supplies and equipment sold to owners, contractors, subcontractors and builders to build, alter, repair
or improve real property. Fact Sheet 128,
Contractors.
Candy and soft drinks. Fact Sheets 102B,
Candy; and 102C, Soft Drinks and Other
Beverages.
Computer software, canned or prewritten.
Fact Sheet 134, Computer Software.
Delivery charges (including shipping and
handling) for taxable items or services. Fact
Sheet 155, Delivery Charges.
Dietary supplements are taxable food
products intended to supplement the diet.
Fact Sheet 102E, Dietary Supplements.
Digital Products, other than prewritten
computer software, that are transferred
electronically to the purchaser. Fact Sheet
177, Digital Products.
Fabrication labor. Charges to produce,
fabricate, print or process items, even if the
customer directly or indirectly furnishes
materials used. Fact Sheets 152A, LaborInstallation, Fabrication and Construction;
145, Industrial Production; 109, Printing
Industry; 169, Photography and Video Production; and 131, Automotive Repairs and
Service.
Fur clothing, including any shipping,
transportation or finance charges. Fact Sheet
105, Clothing.
Prepaid telephone calling cards and recharging fees. Fact Sheet 119, Telecommunications, Pay Television and Related Services.
Grooming and hygiene products, including grooming and hygiene products for babies, are taxable. Fact Sheet 117F, Grooming
and Hygiene Products.
Repair labor. Business related electronic
and precision equipment repair services;
and commercial and industrial machinery
and equipment repair services. Effective July
1, 2013 - March 31, 2014. Fact Sheet 152B,
Labor - Repair for Businesses.
Installation labor for taxable items or
services. Fact Sheets 152A, Labor-Installation, Fabrication and Construction; and
131A, Motor Vehicle - Auto Body Repair and
Service.
Local governments. Most sales to local
governments, including counties, cities and
townships, are exempt. Some schools, hospitals, nursing homes, libraries and towns,
however, can make exempt purchases (see
local governments on page 10). Fact Sheets
111, Schools – Sales and Purchases; 135, Fire
Fighting, Police and Emergency Equipment;
139, Libraries; and 142, Sales to Governments.
Lodging and related services (including
when an online lodging seller or other type
of accommodation intermediary makes a
sale of lodging). Fact Sheet 141, Hotels and
Lodging Facilities.
Machinery, equipment, tools, accessories, appliances, furniture and fixtures,
either new or used. To determine if you
qualify for a capital equipment refund, see
Capital equipment in the “Requesting a
refund” section on page 17. Fact Sheet 103,
Capital Equipment.
Machinery, office equipment and other
items sold by businesses that used the
items in their trade or business. Fact Sheet
132, Isolated and Occasional Sales.
Meals and drinks prepared by the seller,
including take-out orders and catering. Fact
Sheets 102D, Prepared Food; 118, Hospital
and Nursing Home Meals; and 137, Restaurants and Bars.
Motor vehicles. Leases and rentals of
motor vehicles and sales of vehicles that
don’t require registration, such as allterrain vehicles, mini-bikes, racing bikes,
etc., are taxable. (Also see Car rentals in this
section and motor vehicles in the “What’s
not taxable?” section on page 9.) Fact Sheet
171, Motor Vehicle Leases.
Pay television services, including basic,
premium, pay-per-view, digital, direct satellite, music services and other similar services. Fact Sheet 119, Telecommunications,
Pay Television and Related Services.
5
Services. The following services are taxable. For more information, request the
following fact sheets:
112 Building Cleaning and Maintenance
(for commercial and residential
buildings)
113 Motor Vehicle Towing, Washing,
Rustproofing
114 Detective and Security Services
119 Telecommunications, Pay Television
and Related Services
120 Laundry and Cleaning Services
121A Lawn and Garden Maintenance, Tree
and Shrub Services
122 Pets and Pet Grooming, Boarding,
and Care Services
162 Massages (not medically authorized)
166 Parking Services
Telecommunications and pay television equipment used directly by a service
provider primarily to provide their services.
These purchases were taxable from July 1,
2013– March 31, 2014. But starting April 1,
2014 machinery and equipment are exempt
when purchased by a service provider. Fact
Sheet 119, Telecommunications, Pay Television and Related Services.
Tobacco products (except cigarettes),
including cigars, chewing tobacco, snus,
pipe tobacco, electronic cigarettes, e-cigs,
vaporizers, accessories, liquid nicotine, eliquids, etc.
Utilities. Electricity, gas, fuel oils, coal,
wood, water and telephone services are
taxable. For more information, request the
following fact sheets:
116 Petroleum Products
119 Telecommunications, Pay Television
and Related Services
129 Utilities Used in Production
145 Industrial Production
157 Residential Utilities
Also available: Rule 8130.1100, Utilities and
Residential Heating Fuels.
Continued
What’s taxable? (continued)
Vending-machine sales of food, candy,
gum, pop and other beverages, taxable
items, and receipts from game machines
and jukeboxes. Fact Sheet 158, Vending Machines and Other Coin-Operated Devices.
Special tax rates
Tax rates for some items are different from
the general 6.875 percent rate.
Car rentals (additional 9.2% tax and 5%
fee). In addition to the 6.875 percent state
sales tax and any local sales tax, this tax and
fee apply to most rentals of passenger cars,
vans or pickup trucks for fewer than 29 days.
The 5 percent fee is intended to reimburse
lessors for the cost of registering vehicles
that are used for rental purposes and is only
reported once each year. (For filing instructions, see Car rentals — December only on
page 14.) Fact Sheet 136, Motor Vehicle 9.2%
Rental Tax and 5% Fee.
Vehicle sales transit tax. Local sales tax
does not apply to sales of motor vehicles.
However, a $20 transit improvement vehicle
excise tax applies to sales of motor vehicles
when the sale occurs in Anoka, Dakota,
Hennepin, Ramsey, or Washington County.
This excise tax must be collected and
reported by any person in the business of
selling new or used motor vehicles at retail.
Fact Sheet 164, Local Sales and Use Taxes.
mobile home for residential use and this is
the first time it is being sold in Minnesota,
or if you’re selling a park trailer, the sale
is subject to a 4.469 percent tax rate. For
mobile homes, the 4.469 percent tax applies
to the dealer’s cost. Fact Sheet 150, Manufactured Homes, Park Trailers and Modular
Homes.
Waste management
services
Waste management services are not subject
to sales tax but are subject to the solid-waste
management (SWM) tax. These taxes are
reported on your sales and use tax return.
SWM Fact Sheet 1, Solid-Waste Management
Tax.
You must register for waste management taxes so you will be able to report
them on your sales tax return. A penalty of
10 percent for the first violation and 20 percent for subsequent violations applies if the
SWM tax is not reported on the appropriate
lines of the sales tax return.
Waste management services for both
mixed municipal solid waste and non-
Liquor sales -- two taxes apply. The 6.875
percent general sales tax rate and 2.5 percent liquor gross receipts tax apply to beer,
wine and other alcoholic beverages sold at
an on-sale or off-sale municipal liquor store
or other establishment licensed to sell any
type of intoxicating liquor. (If the establishment has only a 3.2 percent malt liquor
license, the 6.875 percent tax rate applies.)
Fact Sheet 137, Restaurants and Bars.
Mobile homes and park trailers
(4.469%). If you’re selling a new or used
6
mixed municipal solid waste (construction and demolition waste, infectious and
pathological waste, industrial waste) are
subject to the SWM tax. Mixed municipal
solid-waste management services include
waste collection, transportation, processing,
disposal, fuel surcharges, and compactor
and container rental charges when made by
the waste service provider.
Residential solid-waste management
services (9.75%). Applies to mixed municipal solid-waste management services to
residential generators, including amounts
from selling bags or stickers to vendors for
resale to residential generators.
Commercial solid-waste management
services and self-haulers (17%). Applies
to mixed municipal solid-waste management services to commercial generators and
self-haulers, including amounts from selling
bags or stickers to vendors for resale to
commercial generators.
Construction and demolition waste and
other non-mixed solid-waste services
($.60 per noncompacted cubic yard).
Construction and demolition debris is
taxed at $0.60 per cubic yard. If the service
provider calculates its waste management
service fee based on weight, an SWM tax
charge of $2 per ton can be used. The tax
must be calculated using the same method
as that used for the service charge.
What’s not taxable?
Items exempt by law
When an item is exempt by law, the seller
does not have to prove why tax wasn’t
charged other than showing the item was
food, clothing, drugs, etc.
Items exempt with an
exemption certificate
When a purchaser gives a seller a fully completed exemption certificate at the time of
sale, the seller does not have to collect sales
tax. Form ST3, Certificate of Exemption, is
used to claim exemption when buying taxable items. The purchaser can give a “singlepurchase” certificate for just one transaction
or a “blanket certificate” that applies to
future purchases of qualifying exempt items.
Exemption certificates do not expire unless
the information on the certificate changes;
however, we recommend updating exemption certificates every three to four years.
Form MCDP-AP, Motor Carrier Direct Pay
Application. Fact Sheet 107, Interstate Motor Carriers.
• Nonprofit exemption. Valid only for
groups organized exclusively for charitable
purposes, senior citizen groups, and religious and educational organizations. This
exemption applies only to purchases made
by nonprofit organizations; it does not
allow them to sell items without collecting
sales tax. To apply, use Form ST16, Application for Nonprofit Exempt Status-Sales
Tax.
• Resource recovery facility exemption.
Allows resource recovery facilities and
their contractors to buy waste processing
equipment exempt. Contact our office for
information on the requirements and how
to apply.
Nontaxable items, uses and
charges
If you want to develop your own certificate
instead of using Form ST3, you must include
the following information:
Most nontaxable items are listed here. An
exemption certificate or other documentation may be required. If you have a question
about when to charge tax, contact us.
• purchaser’s name and address
• purchaser’s tax ID number and state of
issue, or if none, purchaser’s FEIN, or if
none, purchaser’s driver’s license number
or state issued ID number
• purchaser’s type of business
• reason exemption is claimed
• purchaser’s signature and date
Admission tickets to regular-season games,
events and activities for public and private
schools, grades 1–12 and to games, events
and activities sponsored by the Minnesota
State High School League; admissions to
artistic events sponsored by all public and
private nonprofit colleges and universities
in Minnesota if the event is held on the
premises of the college or university; the
Minnesota Zoo; artistic performances sponsored by qualified tax exempt organizations;
and charitable golf tournaments when the
beneficiary of the proceeds is a tax-exempt
organization. Fact Sheet 111, Schools–Sales
and Purchases.
It is not acceptable for a customer to furnish
only a tax ID number; the customer must
furnish all of the above information.
If an exemption certificate is misused in an
effort to evade paying sales tax, a penalty of
$100 for each transaction may apply.
Applying for certain
exemptions
You must apply to the Department of Revenue to obtain a special exemption for the
following:
• Direct pay. Allows the buyer to pay sales
tax on certain items directly to the state
instead of to the seller. Applicants must be
registered to collect sales tax in order to
qualify. Contact our office for information
on the requirements and how to apply.
• Motor carrier direct pay. Allows motor
carriers to pay tax directly to the state
when they lease mobile transportation
equipment or buy certain parts and accessories. Applicants must be registered for
sales tax in order to apply. To apply, use
Advertising materials shipped or transferred outside the state by the seller or the
customer and used solely outside Minnesota.
Fact Sheet 133, Advertising– Creative Promotional Services; and Rule 8130.9250.
Agricultural production materials includes
horticulture, floriculture, aquaculture, silviculture, farming and maple-syrup harvesting.
Fact Sheets 100, Agricultural Production; and
130, Aquaculture Production Equipment.
Air cooling equipment used to convert or
replace ground water cooling systems, if the
purchase is required under M.S. 103G.271,
subd. 5. M.S. 297A.68, subd. 7.
7
Airflight equipment and parts for certain
aircraft. Airplanes and repair parts sold
to airlines. Fact Sheet 101 - Aircraft. Rule
8130.6000.
Ambulances. The lease of a motor vehicle
by an ambulance service licensed by the
Emergency Medical Service (EMS) Regulatory Board that is equipped and specifically
intended for emergency response or for
providing ambulance services. Fact Sheet
135, Fire Fighting, Police and Emergency
Equipment.
Aquaculture equipment including repair
or replacement parts used to maintain or
repair qualifying equipment. Fact Sheet 130,
Aquaculture Production Equipment.
Baby products, such as breast pumps, baby
bottles and nipples, pacifiers, teething rings,
and infant syringes. Fact Sheet 117E, Health
Product Exemptions.
Bullet resistant body armor purchased by
licensed peace officers, and state and local
law enforcement agencies. Fact Sheet 135,
Fire Fighting, Police and Emergency Equipment.
Camp fees are amounts paid to attend a
camp, including charges for meals and lodging, and for instruction or training. Camp
fees are exempt if they are for: (1) services
primarily for children, adults accompanying children, or persons with disabilities; or
(2) educational or religious activities and
the camp or facility is owned and operated
by a 501(c)(3) organization. Fact Sheet 123,
Athletic Facilities, Recreational Areas, Resorts,
and Campgrounds.
Caskets, urns for cremains and burial
vaults. Fact Sheet 165, Funeral Homes,
Mortuaries, Crematories and Cemeteries; and
Rule 8130.6300.
Cigarettes. Tax on cigarettes is collected at
the distributor level rather than at the retail
level.
Clothing and wearing apparel customarily
worn on the human body for general use.
Fact Sheet 105, Clothing.
Coin-operated entertainment and amusement devices may be purchased exempt by
retailers who (1) sell admission to places of
amusement; or (2) make available amusement devices. Fact Sheet 158, Vending Machines and Other Coin-Operated Devices.
Labor to construct, repair or improve real
property. Fact Sheet 128, Contractors.
Continued
What’s not taxable? (continued)
Construction exemption for special
projects under M.S. 297A.71. Certain
purchases for the construction of a specific
project or facility are exempt under M.S.
297A.71, such as waste recovery facilities.
This exemption does not apply to projects
for which you must pay sales or use tax on
qualifying purchases and then apply for a
refund.
Conversion costs to make vehicles
accessible to a disabled person. The exemption covers parts, accessories and labor
to make a vehicle accessible to a disabled
person. Fact Sheet 125, Motor Vehicles Sales
and Purchases.
Court-reporter transcripts or copies of
transcripts of verbatim testimony of legal
proceedings to parties, or representatives of
parties, involved in the proceedings. M.S.
297A.68, subd. 22.
Cross-country ski passes for the use
of public trails. Fact Sheet 123, Athletic
Facilities, Recreational Areas, Resorts and
Campgrounds.
Custom computer software. Fact Sheet
134, Computer Software.
Deliveries arranged by the seller to customers outside Minnesota. Fact Sheet 110, Items
for Use Outside Minnesota.
Detachable tools. Separate detachable
units that are used in producing a direct effect upon the product and have an ordinary
useful life of less than 12 months. Fact
Sheet 145, Industrial Production; and Rule
8130.5500, subp. 9.
Direct mail delivery charges. The sales
tax law has a specific exemption for charges
to deliver or distribute direct mail, if the
charges are separately stated on the invoice
to the purchaser. Exempt delivery charges
for direct mail include charges for transportation, shipping, postage, handling, crating,
and packing. Fact Sheets 173, Direct Mail
and Fulfillment Services; and 155, Delivery
Charges.
Direct pay. Certain items sold to persons
who give you a fully completed exemption certificate indicating their Minnesota
direct pay authorization. Note: The direct
pay authorization does not apply to sales
of services, meals and lodging, admissions,
and motor vehicles. Rule 8130.3400.
Discounts offered by the seller at the
time of sale. Fact Sheet 167, Coupons, Discounts and Other Forms of Payment.
Drugs. Most drugs, prescription or over-thecounter for use by humans. Fact Sheet 117A,
Drugs.
Electricity used to make snow for outdoor
use for ski hills, ski slopes or ski trails. Fact
Sheet 129, Utilities Used in Production.
Electricity and natural gas used as the primary source of residential heat for the billing
months of November - April. Fact Sheet 157,
Residential Utilities.
Farm machinery, including repair or replacement parts (except tires) used to maintain or
repair qualifying equipment. Fact Sheet 106,
Farm Machinery.
Feminine hygiene products. Limited to
tampons, sanitary napkins and panty liners.
Fact Sheet 117E, Health Product Exemptions.
Automatic fire-safety sprinkler systems
and all component parts (including waterline
expansions and additions) are exempt when
installed in an existing residential dwelling,
hotel, motel, or lodging house with four or
more dwelling units. M.S. 297A.68, subd. 23.
Food. Groceries for human consumption.
Candy, soft drinks, dietary supplements and
prepared food are taxable. Fact Sheets 102A
- 102E (on food products); and 115, Food
Stamps.
Fuel oil, coal, wood, steam, hot water, propane and LP gas used for residential heat on
a year-round basis. Fact Sheet 157, Residential
Utilities.
Fundraising sales. Sales made by or for nonprofit organizations may qualify for exemption if certain criteria are met. Fact Sheet 180,
Nonprofit - Organizations and Fundraising.
Gasoline and other fuels on which Minnesota gasoline excise tax has been paid and not
refunded. Other exemptions also apply (see
Petroleum products on page 9). Fact Sheet 116,
Petroleum Products.
Certain health products. Fact Sheets 117A,
Drugs; 117B, Durable Medical Equipment;
117C, Mobility Enhancing Equipment; 117D,
Prosthetic Devices; and 117E, Health Product
Exemptions.
Horses and supplies for the care of horses,
including feed and medications. Fact Sheet
144, Veterinary Practice.
Installment payments on previously
reported credit sales.
Instructional materials required to be
used directly in the completion of a course
of study by students at colleges, universities, or private career schools, including
for-profit schools, if sold to a student who
is regularly enrolled at one of these institutions. Fact Sheet 111, Schools – Sales and
Purchases.
Interest or finance charges incurred after
the sale, if listed separately on the invoice.
M.S. 297A.61, subd. 7.
Logging equipment and repair or
replacement parts (except tires) used
to maintain or repair the equipment. Fact
Sheet 108, Logging Equipment.
Meals for children attending a child
care or early childhood education
program. Meals or drinks purchased for
and served exclusively to children who are
younger than 14 years of age or disabled
children who are younger than 16 years of
age and who are attending a child care or
early childhood education program, are
exempt if they are:
• purchased by a qualified nonprofit child
care facility that primarily serves families
with income of 250 percent or less of
federal poverty guidelines; and
• prepared at the site of the child care facility. M.S. 297A.67, subd. 6.
Meals and drinks served to patients in
hospitals, sanitariums, nursing homes,
senior citizens’ homes, and correctional,
detention, and detoxification facilities as
part of their care. Meals and lunches served
at pre-kindergarten through 12th grade
schools are exempt. Meals and lunches
served at colleges, universities and private
career schools are taxable, unless they are
part of a student’s board contract. Fact
Sheets 111, Schools – Sales and Purchases;
118, Hospital and Nursing Home Meals; and
137, Restaurants and Bars.
Medical equipment including durable
medical equipment for home use, mobility enhancing equipment and prosthetic
devices. Fact Sheets 117B, Durable Medical Equipment; 117C, Mobility Enhancing
Equipment; and 117D, Prosthetic Devices.
Industrial production materials. Industrial
production includes manufacturing, mining, printing, photography, lumbering and
commercial fishing. Fact Sheet 145, Industrial
Production.
8
Continued
What’s not taxable? (continued)
Mill liners, grinding rods and grinding
balls that are substantially consumed in the
production of taconite or other ores, metals
or minerals. Fact Sheet 147, Taconite and Iron
Mining; and Rule 8130.9600.
Used mobile homes used for residential
purposes. Fact Sheet 150, Manufactured
Homes, Park Trailers and Modular Homes.
Mobile transportation equipment, accessories and parts sold to an interstate motor
carrier who gives you a fully completed exemption certificate indicating they have been
approved for motor carrier direct pay. Fact
Sheet 107, Interstate Motor Carriers.
Sales of motor vehicles that must be registered and have a license plate (such as cars,
trucks, trailers, motorcycles, mopeds and
motor homes) are subject to sales tax at the
time of registration with the Department
of Public Safety. For answers to questions
about the sales tax on motor vehicles, call the
Department of Public Safety at 651-296-6911.
Fact Sheet 125, Motor Vehicles Sales and
Purchases.
Newspapers and publications regularly
issued every three months or less. Over-thecounter sales of magazines and periodicals
are taxable. Fact Sheet 109, Printing Industry.
Occasional sales of some business equipment. Fact Sheet 132, Isolated and Occasional
Sales.
Packing materials used to pack and ship
household goods to destinations outside
Minnesota that will not be returned to Minnesota except in the course of interstate commerce. M.S. 297A.68, subd. 16.
Patent, trademark, and copyright drawings and documents. Some drawings,
diagrams, or similar or related documents, or
copies of these documents produced and sold
by a patent drafter are exempt. M.S. 297A.68,
subd. 33.
Personal computers and related software
if specifically required for use in a public or
private school, college, university, or business
or trade school for regularly enrolled students. To qualify, the computers or software
must be sold by the institution. Fact Sheet
111, Schools – Sales and Purchases.
Petroleum products. Petroleum products
are exempt under the following conditions:
• Gasoline, motor fuel, natural gas and propane on which Minnesota gasoline excise
tax has been paid and not refunded.
• Fuels used or consumed in agricultural or
industrial production.
• Fuels for use in ambulances, municipal fire
apparatus and marked police vehicles.
• Petroleum products used to improve agricultural land by constructing, maintaining and repairing drainage ditches, tile
drainage systems, grass waterways, water
impoundment and other erosion-control
structures.
• Petroleum products used in a passenger
snowmobile for off-highway business use
to operate a resort.
• Used motor oil.
Fact Sheet 116, Petroleum Products.
Pollution control equipment. Steel reprocessing firms whose primary business
is the recovery of steel from automobiles,
appliances and other steel products, and
the re-refining of this recovered metal into
new steel products, may purchase pollution
control equipment exempt. The equipment
must be used for the purpose of eliminating, preventing or reducing air, land or
water pollution during or as a result of the
manufacturing process in order to meet state
or federal emission standards. M.S. 297A.68,
subd. 8.
Poultry feed if the poultry is raised for human consumption. M.S. 297A.69, subd. 7.
Prizes for games of skill or chance conducted at events such as carnivals, festivals and
fairs lasting fewer than six days are exempt.
Prizes for use at amusement parks, arcades,
the State Fair and other events that last six
days or more, and for lawful gambling or the
state lottery are taxable. Fact Sheet 148, Selling Event Exhibitors and Operators.
Public safety radio communication system. Purchases of goods and services used to
construct, operate, maintain and enhance the
backbone system of the region-wide public
safety communication system. M.S. 297A.70,
subd. 8.
Real property. Sales of real property, rentals or leases of real property, and rentals of
mobile homes used for residential purposes
for more than 30 days.
Repair labor if listed separately on the
invoice. Note: Labor to repair business
equipment was taxable July 1, 2013 - March
31, 2014.
Resale. Goods and services purchased solely
to resell, lease or rent in the regular course of
business.
Sacramental wine used in religious ceremonies if sold by a nonprofit religious orga-
nization or by someone with a sacramental
wine license. M.S. 297A.70, subd. 9.
Service materials. Materials, utilities, and
short-lived detachable tools used or consumed in providing the following taxable
services are exempt:
• Laundry and dry cleaning (Fact Sheet 120)
• Car washing and towing (Fact Sheet 113)
• Building cleaning and maintenance (Fact
Sheet 112)
• Detective and security services (Fact Sheet
114)
• Pet grooming and animal boarding (Fact
Sheet 122)
• Lawn care (Fact Sheets 121A - 121C)
• Massages (Fact Sheet 162)
Ship repair and replacement parts and
lubricants used by ships or vessels engaged
principally in interstate or foreign commerce. M.S. 297A.68, subd. 17.
Ski areas. Tangible personal property used
or consumed primarily and directly for tramways at ski areas or in snowmaking and snow
grooming operations at ski hills, ski slopes
or ski trails are exempt. For details, see 2000
Sales and Use Tax Law Changes.
Solar energy systems. Solar energy systems
are exempt. “Solar energy system” means a
set of devices whose primary purpose is to
collect solar energy and convert and store it
for useful purposes including heating and
cooling buildings or other energy using
processes, or to produce generated power
by means of any combination of collecting,
transferring, or converting solar-generated
energy. M.S. 297A.67, subd. 29.
Special tooling, i.e., tools, dies, jigs, patterns, gauges and other tooling that has
value and use only for the buyer and only for
the use for which it was made. An item has
value only to the buyer if it is not standard
enough to be stocked or ordered from a
catalog or other sales literature but must be
produced according to the buyer’s special
requirements, and is not commonly used by
someone else whose conditions for use are
reasonably similar to the buyer’s. Fact Sheet
145, Industrial Production.
Telecommunications and pay television equipment used directly by a service
provider primarily to provide their services.
This exemption is effective April 1, 2014.
From July 1, 2013 through– March 31, 2014
all telecommunications and pay television
machinery and equipment were taxable.
Fact Sheet 119, Telecommunications, Pay
Television and Related Services.
9
Continued
What’s not taxable? (continued)
Textbooks, including digital books, that
are required for classes in public or private
schools, colleges, universities, or business and
trade schools when sold to regularly enrolled
students. Fact Sheet 111, Schools - Sales and
Purchases; Rule 8130.6700.
Trade-in allowances can be subtracted
before figuring the tax if the items traded
in are also taxable and sold by the retailer
in the regular course of business. Fact Sheet
167, Coupons, Discounts and Other Forms of
Payment.
Tree, bush and shrub removal for contractors. Tree, bush, shrub and stump removal
services that are sold to contractors or
subcontractors as part of a land-clearing contract. Fact Sheets 121A - 121C (on lawn care).
TV commercials. TV commercials and items
primarily used or consumed in preproduction, production or post-production of a TV
commercial are exempt. Fact Sheet 163, TV
Commercials.
Waste-management containers and
compactors purchased by a waste management service provider to use in providing
waste-management services are exempt. To
qualify, the service provider must collect the
solid-waste management tax on customer
charges or on the lease or rental payments
for the compactors or containers. Containers
for recycling remain taxable. M.S. 297A.68,
subd. 31.
Water utility services for residential use.
Also exempt is unsweetened bottled water
in any size container. Fact Sheets 102C, Soft
Drinks and Other Beverages; 157, Residential
Utilities.
Wind energy conversion systems and
materials used to manufacture, install, construct, repair or replace them. M.S. 297A.68,
subd. 12.
YMCA, YWCA and Jewish Community
Centers of Greater Minneapolis and St. Paul
memberships, both one-time initiation fees
and periodic membership dues. Separate
charges for the use of an association’s sports
and athletic facilities are taxable. Fact Sheet
124, Exercise Facilities and Health Clubs.
Sales to certain people and
nonprofit organizations
The following organizations are allowed to
purchase most items exempt from sales tax.
To claim exemption, they must give a fully
completed exemption certificate to the
seller, indicating the applicable reason for
exemption on the exemption certificate.
Charitable organizations must be operated
exclusively for charitable purposes and be
granted exempt status authorization from the
Department of Revenue. To apply for exempt
status, use Form ST16.
Consular officials. Sales tax exemption
cards are issued to some foreign diplomats
and consular officials stationed in this
country. The card will list any limitations on
the exemption. For example, some officials
must pay tax on hotel room charges or on
purchases under a certain amount.
If someone shows you a sales tax exemption
card, check the card to make sure the purchase qualifies for the exemption. You may
also ask for additional identification. If the
purchase qualifies, write the individual’s tax
exemption number on your billing or sales
invoice. Keep the invoice in your files.
Educational organizations. Schools and
school districts operated exclusively for
educational purposes are exempt. Nonprofit
professional and trade schools, scouts, youth
groups, and youth athletic and recreational
programs, such as Little League, etc., operated exclusively for educational purposes
must be granted exempt status authorization
from the Department of Revenue. To apply
for exempt status, use Form ST16.
Federal government. All sales to the federal
government and its agencies are exempt.
The purchaser must provide a purchase
order, payment voucher or work order. Form
ST3 may also be used. Purchases by federal
employees are taxable, even if they are reimbursed by the federal government.
Hospitals and outpatient surgical centers. Sales to a hospital or outpatient surgical
center are exempt if the items purchased
are used in providing hospital or outpatient
surgical services. M.S. 297A.70, subd. 7.
Most sales to local governments, including
counties, cities and townships, are exempt
from MN sales and use tax as defined by
M.S. 297A.70, subd. 2, and in Fact Sheet 176,
Local Governments - Cities, Counties, and
Townships. In addition, local governments
are eligible for the specific exemptions briefly
described below:
• Sales and leases of vehicles used as ambulances or equipped and specifically
intended for emergency response by
ambulance services licensed by the EMS
Regulatory Board under M.S. 144E.10.
10
• Biosolids processing equipment and
materials incidental to installation for
wastewater treatment facilities.
• Bullet-resistant body armor.
• Chore and homemaking services for the
elderly and disabled that are purchased by
a local government specifically for elderly
and disabled individuals.
• Correctional facility meals for inmates.
• Emergency rescue vehicle repair and
replacement parts.
• Firefighter personal protective equipment.
• Fuels used in ambulances, fire apparatus
and marked police vehicles.
• Purchases by hospitals and nursing
homes owned and operated by local governments.
• Purchases by public and legislative libraries.
• Metropolitan Council. MTC buses, light
rail transit vehicles and repair parts.
• Purchases by school districts and public
schools.
• Solid-waste disposal facility machinery
and equipment.
• Certain goods and services purchased by
towns except when the purchase is an input
to a good or service generally provided by a
private business and the purchase would be
taxable if purchased by the private business.
• Transit program vehicles that meet certain
criteria.
• Water used directly in providing fire protection.
Fact Sheets 111, Schools – Sales and Purchases;
135, Fire Fighting, Police, and Emergency
Equipment; 139, Libraries; and 142, Sales to
Governments.
Non-Minnesota government agencies.
Sales to another state or another state’s political subdivisions are not taxable if the sales
would not be taxed in that other state. This
exemption does not apply to sales of prepared
food, candy, soft drinks, alcoholic beverages
and lodging.
Religious organizations. Churches and
other religious organizations operated exclusively for religious purposes can use Form
ST3 without exempt status authorization or
may apply for exempt status authorization
from the Department of Revenue using Form
ST16.
Continued
What’s not taxable? (continued)
Resource recovery facilities must apply
for and receive authorization from the Department of Revenue.
Senior citizen groups formally organized
for pleasure, recreation and other nonprofit
purposes must obtain authorization from
the Department of Revenue to make exempt
purchases. To apply, use Form ST16.
The State of Minnesota uses direct pay,
which means that Minnesota state agencies
do not pay tax to sellers on purchases of
tangible items. A Minnesota state purchase
order is enough to document the exemption, or an exemption certificate may be
used indicating the direct pay authorization. Note: Charge tax on sales of services,
meals and lodging, admissions, and motor
vehicles to Minnesota state agencies since
the direct pay authorization does not apply
to these items.
Grooming and Hygiene Products, #117F
Motor Vehicle Towing, Washing, Rustproofing, #113
Tribal governments. All sales to Indian
tribal governments are exempt. See Fact
Sheet 160, American Indians.
Fact sheets
Fact sheets are available on many topics related to sales and use taxes. You
can download them from our website at
www.revenue.state.mn.us or contact our office
to have them mailed to you.
Advertising - Creative Promotional Services,
#133
Agricultural Production, #100
Aircraft, #101
American Indians, #160
Aquaculture Production Equipment, #130
Arts and Crafts, #154
Athletic Facilities, Recreational Areas,
Resorts and Campgrounds, #123
Building Cleaning and Maintenance, #112
Candy, #102B
Capital Equipment, #103
Chiropractors, #151
Clothing, #105
Computer Software, #134
Contractors, #128
Coupons, Discounts and Other Forms of
Payment, #167
Delivery Charges, #155
Dentists, #175
Detective and Security Services, #114
Dietary Supplements, #102E
Digital Products, #177
Direct Mail and Fulfillment Services, #173
Direct Selling Companies, #168
Drugs, #117A
Durable Medical Equipment, #117B
Exercise Facilities and Health Clubs, #124
Farm Machinery, #106
Financial Institutions, #138
Fire Fighting, Police, and Emergency Equipment, #135
Food and Food Ingredients, #102A
Food Stamps, #115
Funeral Homes, Mortuaries, Crematories
and Cemeteries, #165
Health Care Facilities, #172
Health Product Exemptions, #117E
Hospital and Nursing Home Meals, #118
Hotels and Lodging Facilities, #141
Industrial Production, #145
Interstate Motor Carriers, #107
Isolated and Occasional Sales, #132
Items for Use Outside Minnesota, #110
Labor - Installation, Fabrication, and
Construction, #152A
Labor - Repair for Businesses, #152B
Labor - Repair for Individuals, #152C
Landscaping Construction Contracts,
#121B
Laundry and Cleaning Services, #120
Lawn and Garden Maintenance, Tree and
Shrub Services, #121A
Libraries, #139
Local Governments - Cities, Counties, and
Townships, #176
Local Sales and Use Taxes, #164
Loggers and Log Home Builders and Sellers,
#153
Logging Equipment, #108
Manufactured Homes, Park Trailers and
Modular Homes, #150
Massages, #162
Meat Processors, #126
Minneapolis Special Local Taxes, #164M
Minnesota State Fair - Sales Tax, #140
Mobility Enhancing Equipment, #117C
Motor Vehicle 9.2% Rental Tax and 5% Fee,
#136
Motor Vehicle - Auto Body Repair and
Services, #131A
Motor Vehicle Leases, #171
Motor Vehicle - Mechanical Repair and
Services, #131B
Motor Vehicle Sales and Purchases, #125
11
Nonprofit - Organizations and Fundraising,
#180
Nursery and Greenhouse Production,
#121C
Parking Services, #166
Petroleum Products, #116
Pets and Pet Grooming, Boarding, and Care
Services, #122
Photography and Video Production, #169
Prepared Food, #102D
Prepaid Wireless E911 and TAM Fees, #179
Printing Industry, #109
Prosthetic Devices, #117D
Residential Utilities, #157
Restaurants and Bars, #137
Sales to Governments, #142
Schools - Sales and Purchases, #111
Selling Event Exhibitors and Operators,
#148
Soft Drinks and Other Beverages, #102C
Special Local Taxes: Detroit Lakes, Giants
Ridge, Mankato, Rochester, St. Cloud,
St. Paul, #164S
Taconite and Iron Mining, #147
Telecommunications, Pay Television and
Related Services, #119
TV Commercials, #163
Use Tax for Businesses, #146
Use Tax for Individuals, #156
Utilities Used in Production, #129
Vending Machines and Other CoinOperated Devices, #158
Veterinary Practice, #144
Also available:
JOBZ Tax Exemptions: Minnesota Job Opportunity Building Zones
General filing information
Your sales and use tax account is set up on
either a monthly, quarterly or annual filing
basis depending on how much tax you owe
each month.
• Annual filing. Tax must average less than
$100 per month.
• Quarterly filing. Tax must average less
than $500 per month.
• Monthly filing. Tax averages more than
$500 per month.
• Seasonal filing. If your business is not
open year-round, request seasonal filing.
With seasonal status, you’ll only need to
file returns for those periods your business is open.
• One-time filing. If you plan to make taxable sales in Minnesota at only one event
or during one month, ask for one-time
filing. Do not apply for one-time filing
if you plan to make taxable sales in the
future.
If the amount of tax you report is consistently higher or lower than the limits, you
can change your filing cycle by calling our
office.
Due dates
You will not receive a notice to remind you
to file your return or pay the tax due, so
it’s important to know the due dates listed
below.
Monthly filers. 20th day of the following
month.
Quarterly filers. April 20, July 20, October
20 and January 20.
Annual filers. February 5 of the following
year. Annual filers must file on a calendaryear basis, not a fiscal or other basis.
Unregistered individuals filing annual
use tax. April 15 of the following year.
When the due date falls on a Saturday, Sunday or legal holiday, returns and payments
made electronically or payments postmarked the next business day are considered timely.
Record-keeping
It’s important to keep good records so you—
and the department—figure the correct
amount of state and local tax you owe. Your
records should include:
• bills, receipts, invoices, cash-register
tapes and any other original documents
that support the entries in your account
books;
• exemption certificates; and
• worksheets used to prepare your tax
returns.
Your records should show both sales (taxable and nontaxable) and purchases, the rate
of tax collected on each sale and any use tax
you paid.
Accounting methods
Use the same accounting method for sales
tax as you use for income tax. If you use
the cash method, include only payments
received in the period of the return. For an
accrual method, include all cash sales, credit
sales, installment sales and COD sales made
during the period of the return.
If you want to change accounting methods,
send us a letter explaining when and why
you want to change, and showing that the
new method will not make auditing your
records more difficult. You cannot change
your filing method until you receive our
written approval.
Statute of limitations
We can audit your return within 3½ years
after you file it. If there’s an error in the
amount of tax, and the difference between
the original amount and the correct amount
is 25 percent or more, we have 6½ years to
audit the return. There is no time limit if we
find you’ve fraudulently reported tax information or have not filed a return.
Penalties and interest
You will be charged penalties and interest if
you don’t file or pay what you owe on time.
Shortage of available cash is not a valid
reason for not filing a return and paying the
tax because sales tax is not an out-of-pocket
expense to the retailer. Sales tax collected by
a retailer must be held in trust for the state
until remitted on or before the appropriate
due date. This money does not belong to
the retailer and should not be used for any
other business purpose.
We’ll send you a notice if we don’t receive
your return or payment. If you have questions or believe we’ve made an error, call
us immediately. We’ll work with you to get
your account current. If you disagree with
the outcome, refer to the notice you receive
for information on your right to appeal.
Failure to pay. If you don’t pay the tax on
time, the following penalties apply:
12
• 5 percent of the tax due if the payment is
one to 30 days late;
• 10 percent if it is 31 to 60 days late;
• 15 percent if it is more than 60 days late.
Failure to file a return. Add an additional
5 percent to the above penalty if you also
don’t file your return on time. Even if your
tax is paid timely, you must still file a return
electronically, either over the Internet or by
phone. A penalty will be imposed for failure
to file a tax return within 30 days after written demand for filing the return is given to
the taxpayer. The penalty is 5 percent of the
tax not paid prior to the written demand or
$100, whichever amount is greater.
For those required to pay electronically.
For mandatory and associated payers, an
additional 5 percent penalty applies to
payments not made electronically. (Refer to
Electronic payment required on page 15.)
Repeated failure to pay. There is an additional penalty of 25 percent of the unpaid
tax if you continually pay your tax late.
Local taxes. If you don’t report local sales
tax on the appropriate line of your sales
tax return, the penalty is 5 percent of the
amount of tax not properly reported on the
return.
Consolidated returns. Location information must be provided for consolidated sales
and use tax returns. A $500 penalty applies
for each return not containing location
information. The privilege to file a consolidated return may be revoked and you may
be required to register and file separately for
each location.
Interest is figured on the total tax plus
penalty at the following rates from the date
you should have paid the tax until the date
the total is paid:
2014
2013
2012
2011
..
..
..
..
3%
3%
3%
3%
2010
2009
2008
2007
. . 3%
. . 5%
. . 8%
. . 8%
2006
2005
2004
2003
...
...
...
...
6%
4%
4%
5%
The same interest rates apply to refunds.
The law allows various ways for us to collect unpaid taxes including cancelling your
authorization to make sales in Minnesota,
which prohibits you from doing business
in the state. It’s a felony to continue to
make retail sales after your authorization is
revoked. There is also a civil penalty of $100
for each day you continue to make taxable
sales after authorization has been revoked.
Continued
General filing information (continued)
Your rights as a taxpayer
As a Minnesota taxpayer, you have the right
to clearly understand your rights and responsibilities under the law, and the Department of Revenue is responsible for helping
you do so. Several brochures are available
on our website or by calling our office. We
also want you to know how your information is used, and what is considered public
and private information.
Public vs. private information
Public information about businesses registered for sales and use tax includes:
• Minnesota tax ID number,
• name and address under which the business is registered,
• business name and location,
• registration date, and
• any registration cancellations.
If someone asks for specific information about your business, only the above
information will be provided (M.S. 270B.08,
subd. 1).
return may not be accepted or processing
of the return may be delayed. You may also
be subject to civil and criminal penalties for
not filing a return.
Private information includes the information you provide on your tax return, except
for the public information listed above.
Private information cannot be given to others without your consent except to the IRS,
other states that guarantee the same privacy
and certain government units as provided
by law.
The information on your return may be
compared with other information you have
provided to the Department of Revenue.
Why we ask for information. Your name,
address, and Minnesota tax ID number are
required for identification.
Your taxable sales and use tax purchases
are required to determine your correct tax.
If you don’t provide this information, your
Preparing to file your return
Before you start
Subtracting sales tax from receipts
You may need to make adjustments to your
figures before you file your return.
If your total receipts include sales tax, you must subtract the tax from the total receipts
before filing your return.
If the following items apply to sales in the
current period, subtract them from the appropriate tax type before you file. (To make
changes to a prior period, file an amended
return. See “Amending a return” on page
18.)
If receipts
include tax
at rate:
• Bad debts on sales previously reported
if you have written them off for federal
income tax purposes.
• Cash or credit refunds given to customers.
• Checks that are returned for nonsufficient
funds if you are on the cash method of
accounting.
Be sure to adjust the correct tax type. For
example, if a customer returns an item that
was subject to Minnesota sales tax and
transit improvement tax, be sure to adjust
both state and transit improvement sales tax
types. If your return shows a credit balance
as a result of these adjustments, we will
refund the overpayment to you. Do not take
credit for the overpayment on other returns.
Sales tax types
When you file electronically, you will be
asked to enter figures for only the tax types
for which you are registered.
6.875%
7.025%
7.125%
7.275%
7.375%
7.525%
7.625%
7.775%
7.875%
8.875%
9.125%
9.375%
9.525%
9.625%
Divide
receipts by:
1.06875
1.07025
1.07125
1.07275
1.07375
1.07525
1.07625
1.07775
1.07875
1.08875
1.09125
1.09375
1.09525
1.09625
Multiply
OR
by:
If receipts
include tax
at rate:
0.93563
0.93432
0.93345
0.93214
0.93127
0.92997
0.92911
0.92782
0.92696
0.91848
0.91634
0.91424
0.91299
0.91216
9.775%
9.875%
10.025%
10.125%
10.275%
10.525%
10.775%
13.025%
13.275%
13.400%
13.525%
13.775%
16.025%
16.275%
Divide
receipts by:
1.09775
1.09875
1.10025
1.10125
1.10275
1.10525
1.10775
1.13025
1.13275
1.13400
1.13525
1.13775
1.16025
1.16275
OR
Multiply
by:
0.91091
0.91013
0.90884
0.90802
0.90678
0.90473
0.90269
0.88472
0.88277
0.88183
0.88082
0.87889
0.86185
0.85999
Example: All prices at your restaurant include Minnesota sales tax only. The total taxable
sales at the end of the month are $10,000. Divide $10,000 by 1.06875 (or multiply by
.93563) to remove the Minnesota tax ($10,000 ÷ 1.06875 = $9,357). Report $9,357 on the
General rate sales line.
If you file over the Internet, you can add additional tax types to your return by clicking
“Add a sales tax type.”
Following are all the tax types that can be
reported on the sales and use tax return.
If filing by phone, you must register for any
additional tax types before you file. Call
651-282-5225 or 1-800-657-3605.
Report total receipts or sales from all business operations for Minnesota during the
reporting period (what you report as MinContinued
13
Gross receipts
Preparing to file your return (continued)
nesota receipts for income tax). Include all
taxable and exempt sales, leases and rentals.
Do not include sales tax. You must always
enter an amount for gross receipts. If you
don’t have gross receipts to report, enter zero.
Note: If the establishment has only a 3.2
percent malt liquor license, only the 6.875
percent tax rate and any local tax applies.
General rate sales (6.875%)
Two taxes apply — the 6.875 percent general use tax rate and 2.5 percent liquor gross
receipts use tax. Report the purchase price
of taxable beer, wine and other alcoholic
beverages bought for business or personal
use that were not taxed when you bought
them. In addition to reporting liquor purchases on the Use tax purchases or Variablerate purchases line, you must also report
liquor purchases on this line and on any
applicable local tax lines.
Report all taxable sales, including liquor
sales, leases, rentals and services subject to
the 6.875 percent tax rate. Be sure to include
sales subject to local tax here and on the appropriate local tax line.
Use tax purchases (6.875%)
Report the purchase price of taxable items
bought for business or personal use that
were not taxed when you bought them. Include only amounts subject to the full 6.875
percent tax rate. Fact Sheet 146, Use Tax for
Businesses.
Variable-rate purchases
If you bought items in another state and paid
sales tax at a rate lower than Minnesota’s rate,
you owe the difference between the Minnesota rate and the rate paid to the other state.
You must enter the purchase price of the
items and the difference in the tax amount.
Example: If you bought a computer in another state for $3,000 and paid 4 percent tax,
you owe 2.875 percent use tax (6.875% - 4%
= 2.875%) to Minnesota. Enter $3,000 for the
variable-rate purchases taxable amount and
$86.25 for the tax amount ($3,000 x 2.875%
= $86.25; round to $86). Fact Sheet 146, Use
Tax for Businesses.
Local city and county taxes
The local taxes that you are registered for
will show on your sales and use tax return.
Report all taxable sales, leases, rentals and
services subject to local tax on the appropriate line. For a current list and information
about local taxes, see Fact Sheet 164, Local
Sales and Use Taxes. For information about
the special local taxes that apply to restaurants, liquor, lodging, and entertainment, see
Fact Sheets 164M, Minneapolis Special Local
Taxes; and 164S, Special Local Taxes: Detroit
Lakes, Giants Ridge, Mankato, Rochester, St.
Cloud, St. Paul.
Liquor gross receipts sales (2.5%)
Two taxes apply — the 6.875 percent general
sales tax rate and 2.5 percent liquor gross
receipts tax. These taxes apply to beer, wine
and other alcoholic beverages sold at businesses licensed to sell any type of intoxicating liquor. In addition to reporting liquor
sales on the General rate sales line, you must
also report liquor sales on the Gross receipts
liquor line and on any applicable local tax
lines.
Liquor gross receipts use tax
purchases (2.5%)
Motor carrier direct pay (MCDP)
purchases
If you have Motor Carrier Direct Pay
(MCDP) authorization, add all purchases of
qualifying repair parts and accessories, and
leases of mobile transportation equipment.
Enter this amount as the taxable amount for
MCDP purchases. Multiply this figure by
your Minnesota prorate mileage percentage,
and then multiply the result by the 6.875
percent tax rate. Enter the result as the tax
amount.
Example: You paid $4,000 for repair parts.
Your Minnesota prorate mileage percentage
is 5 percent ($4,000 × 5% = $200; $200 ×
6.875% = $13.75; round to $14). You would
enter $4,000 as the taxable amount and $14
as the tax amount. Fact Sheet 107, Interstate
Motor Carriers.
Mobile home sales (4.469%)
Report the sale of a mobile home if it is the
first time it is registered in Minnesota and
if it will be used for residential purposes.
For mobile homes, enter the dealer’s cost of
the mobile home. For new and used park
trailers, report the selling price. Fact Sheet
150, Manufactured Homes, Park Trailers and
Modular Homes.
Car rentals (9.2%)
Report leases or rentals of passenger automobiles, vans or pickup trucks for periods
of fewer than 29 days. Also include these
sales on the General rate sales line. Fact
Sheet 136, Motor Vehicle 9.2% Rental Tax
and 5% Fee.
Car rentals (December only – 5%)
This fee is intended to reimburse lessors for
the cost of registering vehicles and is only
reported once per year on the December
return.
14
If the amount of the 5 percent fees collected
during the calendar year are more than the
registration taxes paid during the year, you
must pay the difference with your December sales and use tax return.
Your December return will have two separate
lines for reporting the total 5 percent fees
collected and the amount you paid as registration taxes on the vehicles that you hold for
rental purposes. To complete your December
sales and use tax return, report the tax collected and registration fees paid as follows:
1. Enter the total amount of the 5 percent
fees collected during the calendar year in
the “Taxable” column on the “Car Rentals
(December only)” line. (Do not report
the taxable amount.)
2. Enter the total amount you paid as
Minnesota registration tax during the calendar year for vehicles that you hold for
rental purposes in the “Taxable” column
on the “Registration taxes paid” line.
3. Subtract the registration tax (step 2
above) from the 5 percent fees (step 1
above) and enter the difference as “Tax”
on the “Car Rentals (December only)”
line. If the result is less than zero, enter
“0” as “Tax.”
Fact Sheet 136, Motor Vehicle 9.2% Rental
Tax and 5% Fee.
Registration taxes paid
Report the actual registration tax you paid
on the vehicles you rented. This is only
reported once per year on the December
return. Fact Sheet 136, Motor Vehicle 9.2%
Rental Tax and 5% Fee.
Residential solid-waste management (SWM) services (9.75%)
Report mixed municipal solid-waste management services to residential generators,
including amounts from selling bags or
stickers to vendors for resale to residential
generators. SWM Fact Sheet 1, Solid-Waste
Management Tax.
Commercial SWM services (17%)
Report mixed municipal solid-waste management services to commercial generators
and self-haulers, including amounts from
selling bags or stickers to vendors for resale
to commercial generators. SWM Fact Sheet
1, Solid-Waste Management Tax.
Non-mixed municipal solid-waste
(Non-MMSW) SWM services ($.60
per noncompacted cubic yard)
List the total number of noncompacted
cubic yards of waste. SWM Fact Sheet 1,
Solid-Waste Management Tax.
Filing electronically
You can both file and pay electronically using
our system over the Internet. If you don’t
have Internet access, a telephone option is
available. Use our system to:
• file current and past due returns
• pay current and past due returns
• file amended returns
File early—pay later. You can file your
return early but schedule the electronic
withdrawal of your payment for the due date.
Other methods of payment are explained
below—but you must still file your return
electronically either online or by phone.
Due dates. You will not receive a notice to
remind you to file your return or pay your
tax so it’s important to remember the due
dates listed below. Unless you are required
to make accelerated payments as described
under “Electronic payment required” (on
this page), the due date for filing and paying
your sales and use tax are the same. If the
due date falls on a Saturday, Sunday or legal
holiday, returns filed and payments made
electronically and payments postmarked the
next business day are considered timely.
• Monthly filers – 20th day of the following
month.
• Quarterly filers – April 20, July 20, October 20 and January 20 of the following
year.
• Annual filers – February 5 of the following year.
If you do not owe any tax, you must still electronically file your sales and use tax return.
Filing by Internet or phone
For detailed information on how to file, see
the step-by-step instructions on our website.
To file on the Internet, go to our website at
www.revenue.state.mn.us and login.
If you don’t have Internet access, call 1-800570-3329 to file by touch-tone phone.
Note for first-time users: If you’re using the
system for the first time and need a temporary
password, call our Business Registration office
at 651-282-5225 or 1-800-657-3605.
Multiple users. More than one user can
be set up to file and pay a business’s taxes
through our online system. One person acts
as the “password administrator” and is in
charge of setting up users, assigning them
passwords, and giving them access to file
and pay taxes for the business. The password
administrator can change a user’s password
and access rights, remove a user or add
another user at any time by clicking “Manage
account” from the main menu.
Consolidated filers. If you file a consolidated return, you must use the Internet to
file. You can either enter the return information for each location separately, or attach
an electronic spreadsheet with information
for all locations. For either method, follow
the instructions for consolidated filers on
the department’s website under “Help.”
Go to www.revenue.state.mn.us and login.
Click on the Help tab toward the top of the
screen and select “File a consolidated sales
and use tax return.”
Paying the balance due
You must pay your sales and use tax in one
of the following ways.
Electronically using our system. This is
the easiest and most convenient way to pay
your tax—and it’s free. You can do it at the
same time you file your return, and you’ll
get a confirmation number so you’ll know
your transaction is completed. Follow the
prompts on the Internet or phone system.
You’ll need your bank’s routing number and
your account number. Funds associated
with any foreign banks are not accepted.
ACH debit. The ACH (Automated Clearing House) debit method allows you to
transfer funds by authorizing the Department of Revenue to electronically debit
(electronically withdraw funds from) your
bank account for the amount you report
via our online system. Your account will
be debited only upon your initiation, only
for the amount you specify, and only on the
date you specify.
To obtain the department’s ACH company
ID, please call a sales tax representative at
651-296-6181 or 1-800-657-3777.
Bank wire. A taxpayer may transfer funds
from a bank account directly to the department’s account. Instructions on how to
make a bank wire transfer must be obtained
by contacting the department at 651-5563003 or 1-800-657-3909.
Credit card. A taxpayer may access www.
payMNtax.com to make a credit card payment using Visa, MasterCard, American
Express or Discover/Novus. Credit card
payments are processed by Value Payment
Systems LLC, which charges a convenience
fee for the service. The fee can be calculated
in advance using the payMNtax.com fee
calculator.
By paper check. If you are not required to
pay electronically (see below) and choose
to pay by check, you must complete and
15
include a sales and use tax return payment
voucher. If you did not receive personalized
vouchers, go to our website and click on
Make a Payment and then By Check. Follow
the prompts to create a payment voucher. A
personalized scan line will be printed on the
bottom of the voucher using the information
you entered. Print and mail the voucher with
your check.
Mail your check and voucher to: Minnesota Revenue, P.O. Box 64622, St. Paul, MN
55164-0622.
Electronic payment
required
Mandatory electronic payments. If you
have a sales and use tax liability of $10,000
or more in the state’s fiscal year (July 1 – June
30), you must pay all taxes electronically
beginning with the next calendar year.
Associated payers. If you are required to
electronically pay any business tax type to
the Department of Revenue, you must pay all
business taxes electronically.
When the Department of Revenue first determines you are required to pay electronically,
there will be a message on the screen when
you log into our system to file your sales tax
return on the Internet. This message will appear for a short time to initially notify you of
the requirement.
Penalty. If you are required to pay electronically and do not, a 5 percent penalty (in addition to regular penalties) applies to payments
not made electronically, even if a paper check
is sent on time or early.
June accelerated payment. The June accelerated payment is due two business days
before June 30, and the remaining payment
and return for June is due August 20.
To avoid penalty, your June accelerated payment must be at least:
• 81.4 percent of your actual June liability, or
• 81.4 percent of your May liability, or
• 81.4 percent of your average monthly liability for the previous calendar year.
To avoid possible penalties and interest, it is
important to review your account to ensure
that you are filing and paying properly.
Penalty. If you do not make an accelerated
payment by the required due date or you
underpay the amount, you will be subject
to a penalty. The penalty is 10 percent of the
difference between what was paid and the
required estimate.
Continued
Requesting a Refund
Capital equipment
Tax paid on audited periods
Disabled veterans
Use Form ST11, Sales and Use Tax Refund
Request and Multiple Period Amend Return,
to request a refund for capital equipment.
To qualify, the equipment must be used for
manufacturing, fabricating, mining or refining tangible items to be sold ultimately at
retail; electronically transmitting results retrieved by a customer of an online computerized data-retrieval system; or for generating electricity or steam to sell at retail. You
may file only two capital equipment refund
requests per year. Fact Sheet 103, Capital
Equipment.
Use ST11-AUD, Claim for Tax Paid on
Periods Audited for Sales and Use Taxes, to
file a request for refund of Minnesota sales,
use and/or local taxes assessed on a sales
and use tax audit that has been paid in full.
The refund request must be filed within 3½
years from the date the tax was due or one
year from the date of an order assessing tax,
whichever is later. You must attach the audit
report and all audit schedules and exhibits.
Disabled veterans may request a refund of
sales tax paid on building materials used
to construct or remodel their homes using
Form ST11VA, Claim for Refund-Veteran’s
Homestead. To qualify, the construction
or remodeling must be financed under a
special federal grant program administered
by the Department of Veterans Affairs.
For sales tax paid to a seller, the request
must be filed within 3½ years from the 20th
day of the month following the month of the
invoice date for the purchase of the capital
equipment. For use tax paid directly to the
state, the request must be filed within 3½
years from the due date of the return on
which the use tax was due, or one year from
the date of an order assessing tax, if the tax,
penalties and interest shown on the order
have been paid in full, whichever period
expires later.
Purchaser refunds
Use Form ST11, Sales and Use Tax Refund
Request and Multiple Period Amend Return,
to request a refund of sales tax paid to a
vendor in error. You may file only two purchaser refund requests per year. To qualify,
you must be registered to report sales or use
tax and the total amount requested on each
refund request must be over $500 in tax.
Utility service providers
Utility service providers may use Form
ST11, Sales and Use Tax Refund Request and
Multiple Period Amend Return, to request refunds of Minnesota sales tax and any related
local sales taxes remitted on behalf of their
customers who are now requesting exemption for multiple periods.
To qualify, you must:
• be in the business of providing utility
services to customers and be currently
registered to collect and remit Minnesota
sales tax,
• be adjusting taxable sales figures for more
than one period, and
• have refunded the tax collected back to
your customers.
The request must be filed within 3½ years
from the 20th day of the month in which
the tax was originally due.
A purchaser request for refund must be filed
within 3½ years from the 20th day of the
month following the month of the invoice
date for the purchase.
16
The request may be filed up to 3½ years
from the date the return was due or one
year after the order date assessing tax on an
audit.
This form is distributed by the Veterans’
Administration to veterans who qualify for
this exemption.
Special purchase refunds
Use Form ST11, Sales and Use Tax Refund
Request and Multiple Period Amend Return,
to request a refund of sales or use tax paid
on certain exemptions. Refer to Form ST11
for details about the exemptions that qualify
for a refund using this form.
A request for refund may be filed up to 3½
years from the date the return was due. You
may file only two special purchase refund
claims per year.
Amending a return
If an error was made on a sales and use
tax return that was filed, you must file an
amended return to correct the error using
e-Services, either over the Internet or by
phone.
However, consolidated filers must use the
Internet system to file amended returns.
Our phone filing system is not available for
consolidated filers.
You are required to file an amended return
for each return requiring an adjustment.
You must file an amended return if you:
• did not report enough tax on your original return;
• reported too much tax on your original
return;
• charged an incorrect tax rate on an item
and will refund the tax to the purchaser;
• charged sales tax on an item you shipped
directly to another state (or another
city or county if local sales taxes are
applicable) and refunded the tax to the
purchaser;
• charged sales tax on nontaxable items and
refunded the tax to the purchaser;
• received a valid exemption certificate
from a customer to exempt a sale reported in a prior period and refunded the
tax to the purchaser;
• reported sales or purchases in the wrong
tax type.
Do not use an amended return for adjustments you can make on a current return,
such as adjustments for:
• bad debts
• cash or credit refunds
• returned checks
Do not use an amended return to request a refund of sales or use tax paid
when a special request for refund form
is required. Instead, use the specific form
indicated on page 16).
Amended returns may be filed up to 3½
years from the date the return was due or
one year after the order date assessing tax
(i.e., on an audit).
Keep all supporting documents for any
amended returns in your records. These
must be made available to the department if
your business is audited. If we find that the
amended returns were in error, you could be
billed for the tax plus penalty and interest.
How to file
To amend a return, login on our website or
call 1-800-570-3329 to file over the phone.
Follow the prompts to file an amended sales
tax return using the steps below:
1. Select the period you are amending.
Enter the date of the reporting period you
are amending. On the phone, you must
enter two digits for the month and four
digits for the year (mmyyyy).
Continued
Example
You made sales to an organization in the
month of May 2014, charged sales tax, and
reported the tax on your monthly return.
Later, the organization gave you a valid exemption certificate and requested a refund
of the tax paid in error.
The sales incorrectly taxed were:
Month of May 2014
Gross receipts . . . . . . . . . . . . . . . . . . . . $5,500
Original general rate taxable sales . . . . . 3,500
Corrected general rate taxable sales . . . 3,000
Original sales tax paid . . . . . . . . . . . . . . . . . 241
Filing by Internet
1. Select File an amended return. Choose
the ending period for the return you
are amending from the drop-down box.
(If you choose “Other Period,” another
screen will open. Select the ending period for the return you are amending.)
Click Continue.
2. Select the reason for amending the
return. Enter a contact name, phone
number and explain the reason for the
change in the text box. Click Continue.
3. Enter “5500” in the Gross receipts line,
(there is no adjustment to this amount).
4. Enter “3000” (the corrected amount) on
the General rate sales line.
5. Enter “241” (the amount of sales tax paid
on the original return) on the Total payments for the tax period line.
6. Click Calculate to figure the tax. The
system will automatically calculate the
refund or amount due. In this example,
there would be a tax refund of $35.
7. Click Continue to file the amended return.
8. Print or save the confirmation number
for your records.
Filing by phone
1. Press 3 to amend a return. Enter the ending period for the return being amended
(May 2014). To choose a period, use two
17
digits for the month “05” and four digits
for the year “2014.”
2. Enter a two-digit reason code for
amending the return (see reason codes
on page 19).
3. Enter “5500” and then the pound key
(#) for the gross receipts line (there is
no adjustment to this amount).
4. Enter “3000” (the corrected general rate
taxable sales), followed by the # key.
Press 1.
5. Follow the prompts for any other tax
types for which you may be registered.
e-Services will calculate your amended
return.
6. Press 1 if the amended return is correct,
press 2 to repeat the total, or press 3 to
start over.
7. Write down the confirmation number
and date filed for your records.
Amending a return (continued)
2. Select the reason for amending the
return. On the Internet, you’ll select the
reason from a list. On the phone, you’ll
enter a two-digit reason code. See “Reason
codes for amending returns” on this page.
3. Enter the correct taxable amounts.
When amending a return, report the
correct taxable amount for each line item
as though you are filing the return for the
first time.
When entering the correct figures on the
amended return:
round all amounts to whole dollars
do not use commas
use a minus sign (-) for negative numbers
enter the correct taxable amount for
each tax line as though you are filing the
return for the first time. If there is no
change to the amount originally reported,
you still need to enter the correct amount
on the amended return.
• complete all tax lines on the return. For
example, if you are adjusting both Minnesota and Minneapolis sales tax, enter the
correct taxable amount on each of those
tax lines.
Reason codes for amending returns
Code Reason
14
Advertising materials and
exempt publications. Sales tax
charged incorrectly to customers
(or use tax accrued) on exempt
publications or advertising materials shipped out of state.
15
•
•
•
•
16
Exempt organization/federal
government. Sales tax incorrectly
charged to a charitable, religious or
educational organization; Indian
tribal council; the federal government; or an exempt local government agency such as a school or
hospital.
18
Farm machinery. Sales tax
charged at an incorrect rate, or tax
charged on exempt repair parts or
farm machinery.
Keep your confirmation number and filing date for your records.
The system will automatically calculate any
amount you owe or refund you can expect.
If your amended return results in additional
tax due, you can either:
• pay the additional tax electronically the
same time you file your return; or
• if you are not required to make electronic
payments, you can pay by check, using a
sales and use tax return payment voucher.
Go to our website and click on Make a
Payment and then By Check to create
a payment voucher. Print the voucher
and mail it with your check. File your
amended return electronically.
If your amended return results in a reduction in the amount of tax due, we will
refund it to you. Do not take credit for the
overpayment on other returns.
Direct pay. Sales tax incorrectly
charged to customers on items
purchased with direct pay authorization.
17
Note: The system will calculate any interest.
Balances due and refunds
Agricultural and industrial
production exemption. Sales tax
incorrectly charged to customers
(or use tax accrued) on materials,
packaging supplies or short-lived
accessory tooling consumed in
agricultural or industrial production.
19
Interstate commerce/intercity
or intercounty commerce. State
sales tax or local sales tax charged
on items shipped out of state or
out of the local taxing area.
20
Leases of tangible items. Sales
tax charged on equipment that was
part of a lease/finance agreement
or a sale/leaseback agreement.
23
Resale exemptions. Sales tax
charged on items to be sold or
leased by your customer at retail.
If the original return you are amending was
filed late, penalty and interest will apply to
any additional amount you owe. Note: This
amount will not be calculated at the time
you file; a separate bill may be sent.
18
Code Reason
24
Resource recovery exemptions.
Sales tax incorrectly charged on
items purchased with resource
recovery facility exemption authorization.
25
Sales tax accounting errors.
Incorrect taxable amount used to
calculate tax liability on original
return.
26
Special tooling. Sales tax incorrectly charged (or use tax accrued)
on special tooling.
27
Including tax in taxable
amount. Tax incorrectly included
in the taxable amount used to
calculate your sales tax liability.
28
Paying tax to another state.
Sales tax incorrectly charged (or
use tax accrued) on items legally
taxable in another state, when
the other state’s tax was paid or
assessed in an audit. (See Variablerate purchases on page 14 if the
other state has a sales/use tax rate
different from the Minnesota rate.)
29
Tax paid twice. Sales tax charged
and use tax accrued on the same
transaction.
30
Use tax accrual errors. Incorrect
taxable amount used to calculate
use tax liability.
31
Utilities (electric, gas, steam,
water or other fuels). Sales tax
incorrectly charged on utilities
to customer who is exempt for
agricultural production, industrial
production, or residential use.
Note: If the request is for multiple
reporting periods, use Form ST11
(see page 16).
32
Other. Use only if none of the
codes listed above describes
the error.
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