Sales Tax FAQs

Explore commonly asked questions about sales and use tax. A great starting place to learn about fundamental sales tax concepts and general applications to business.

How Sales Tax on Construction Works for Buyers and Sellers

Sales and use taxation of construction and real property transactions can be an area of great complexity that affects more than just contractors. Whether you’re a tax professional who works for a construction company or for a business that enters…

Connecticut Updates Guidance on How Materialmen May Use Pay-When-Paid Method

Connecticut has issued an information publication, effective September 24, 2018, providing updated guidance for materialmen using the pay-when-paid method.

Wisconsin Expands Exemption for Construction Contracts

Effective December 1, 2017, the Wisconsin sales tax treatment for lump sum contracts expanded to all construction contracts, subcontractors, and to certain products sold by a subcontractor to a prime contractor.

Saskatchewan Increases Provincial State Tax Rate to 6%

Effective March 23, 2017, the Canadian province of Saskatchewan increased its provincial sales tax rate. Other changes in excise, property and income taxes were also included in the provisions.

Government Contractor in Georgia Liable for Tax on Items Used Overseas

The Georgia Court of Appeals upheld the denial of a sales tax refund sought by a contractor on items it purchased for use in the construction of facilities in Afghanistan for the U.S. government.

Washington Enacts Exemption for Construction of Buildings for Airplane Maintenance

Effective from July 1, 2016 until January 1, 2027, Washington enacted a sales and use tax exemption for charges for labor and services rendered for construction of new buildings made to an eligible maintenance repair operator.

Contract Terms Dictate Tax Treatment in Florida

Itemization of contract terms dictate tax treatment in Florida. More…

Equipment Supplier Not Liable for Tax on Sales to Contractors at Reduced Rate in Mississippi

Mississippi ruled that a commercial kitchen supplier was not liable for tax on sales to contractors at a reduced rate. More…

Oregon Authorizes Local-Level Construction Tax

Oregon authorized the imposition of local-level construction taxes, effective 06/02/16. More…

Purchases Considered Taxable Business Fixtures in Ohio

Ohio rules that a taxpayer’s purchases were considered taxable business fixtures in Ohio. More…

Wisconsin Enacts Exemption for Contractor Purchases for Certain Exempt Entities

Wisconsin created sales and use tax exemption for contractor purposes, effective 01/01/16. More…

Contractors Should Consider California Manufacturing and R&D Partial Exemption

California advises construction contractors to consider manufacturing and R&D partial exemption. More…

Texas Announces Exemption for Disaster Relief in Bastrop County

Texas citizens affected by Bastrop County wildfires can claim a sales tax exemption on labor charges to repair damages. More…

Georgia Issues Guidance on Construction Exemption for Private Colleges

Georgia issued guidance on the temporary sales and use tax exemption for construction materials used at a private college. More…

Colorado Discusses Lump-Sum and Time and Materials Construction Contracts

Colorado discussed whether a contractor was liable for sales tax on purchases for lump-sum and time and materials contracts. More…

Audio-Visual Equipment Not Classified as Building Materials in Colorado

Colorado discussed whether audio-visual equipment was classified as building materials for exemption purpose. More…

Government Contractor Liable for Georgia Sales and Use Tax on Items Purchased for Overseas Contract

Georgia ruled that a contractor was not entitled to a sales and use tax refund for items purchased for an overseas contract. More…

Machinery, Equipment and Other Items Used in Construction-Related Activities Taxable in Missouri

A taxpayer’s machinery, equipment, materials, and supplies purchases used in construction-related activities are taxable in Missouri. More…

Construction Materials Pulled from Inventory Non-Taxable in Indiana

A retailer also acting as a general contractor was not liable for Indiana sales tax on construction materials. More…

Leased Realty Improvements Were for Benefit of Exempt Entity in Texas

A build-to-suit lease between an exempt nonprofit entity and a nonexempt landlord qualified as an exempt contract from Texas sales tax. More…

New Mexico Issues Ruling on Home Sale and Construction Services

New Mexico issued a ruling about the application of gross receipts taxes on home sale and construction activities. More…

Installer Liable for Tax on Materials Installed for Exempt Entities in Wisconsin

According to a Wisconsin Court of Appeals, an installer was liable for Wisconsin sales and use tax on materials that it installed for exempt entities that were purchased by the exempt entities from the installer’s sister company. Wisconsin law allows…

Minnesota Clarifies Treatment of Repair and Maintenance Labor

The Minnesota Department of Revenue has issued a clarification regarding the sales and use tax treatment of repair and maintenance labor. The department also noted that refunds may be available to some taxpayers who collected tax on such labor. The…