The Wisconsin DOR issued guidance for painting and finishing contractors on the taxability of their sales and purchases. Sales of tangible personal property by contractors are taxable, unless an exemption applies. However, if the sale and installation of tangible personal property is an addition or capital improvement of real property once installed, it is considered a nontaxable real property construction activity. The sale of certain services such as repair, alteration, cleaning, painting, coating, or maintenance of tangible personal property that is affixed to real property or is installed by the contractor once the service is completed, is also a nontaxable real property construction activity. If the sale of such services listed above (repair, alteration, cleaning, etc.) are performed on tangible personal property that is not affixed to real property or is not installed by the contractor, the service is a taxable service to tangible personal property.
Contractors that sell or provide services to tangible personal property may purchase materials transferred to the customer without tax for resale. If a contractor provides a nontaxable real property construction activity, they must pay tax on the materials used in providing the activity unless it is exempt. (Painting and Finishing Contractors – Are Your Sales Subject to Sales Tax?, Wisconsin Department of Revenue, February 22, 2019)