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Last Updated: 7/16/2018

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Sales and Use Tax > Tax Information > Streamlined sales tax information

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    We understand the impact the United States Supreme Court’s decision may have on your business. In an effort to ensure a fair and smooth transition for taxpayers with a new collection responsibility, we are working to provide information and assistance to help your business meet sales and use tax obligations under Minnesota law.

  • What was the U.S Supreme Court decision (South Dakota v. Wayfair)? Back to top

    On June 21, 2018, the United State Supreme Court ruled in South Dakota v. Wayfair that sellers can be required to collect sales taxes in states where the sellers do not have physical presence, overruling the 1992 case of Quill v. North Dakota. 

    We are updating Fact Sheets, Industry Guides, and Revenue Notices based on the court’s decision and will post them on our website soon. Subscribe to Sales and Use Tax Updates and check back on our website for more information.

  • What is the impact of the Wayfair decision on sales into Minnesota?Back to top

    Minnesota law requires remote sellers to collect Minnesota Sales and Use Tax on their sales into the state. See Minnesota Statute 297A.66, subdivision 3(b).

  • Who is a remote seller?Back to top

    Generally, a remote seller is a business that sells its products to customers in a state, using the Internet, mail order, or telephone, without having a physical presence in that state.

  • I am a remote seller, what should I do?Back to top

    Remote sellers that were registered in Minnesota before the U.S. Supreme Court's decision in South Dakota v. Wayfair, are not impacted by this decision. You need to continue to collect and remit sales and use tax.

    Remote sellers that were not already registered in Minnesota before the U.S. Supreme Court’s decision in South Dakota v. Wayfair, Inc., must register and begin collecting sales tax in Minnesota no later than October 1, 2018, unless you meet the Small Seller Exception (see below).

  • What is the Small Seller Exception?Back to top

    Minnesota law provides a Small Seller Exception, which does not require remote sellers to collect sales tax until their sales during a period of 12 consecutive months total either:

    • 100 or more retail sales shipped to Minnesota
    • 10 or more retail sales shipped to Minnesota that total more than $100,000
    Note: When calculating this exception, do not include any sales where the purchaser is buying for resale.
     
    The purchaser may give you a completed Form ST3, Certificate of Exemption claiming an exemption for resale.

  • I exceeded the Small Seller Exception, when do I need to register to collect Minnesota sales tax?Back to top

    You must register, collect, and remit Minnesota sales tax on the first taxable retail sale into Minnesota that occurs no later than 60 days after you exceed the Small Seller Exception. You will also have a sales tax return filing obligation. See “How often will I need to file a return?” (below).

    Note: If you know that you will be making sales into Minnesota, you may choose to collect and remit Minnesota sales tax at any time.

  • When calculating the Small Seller Exception, what is the earliest month of sales I need to include?Back to top

    If you were not already registered in Minnesota before the U.S. Supreme Court’s decision in South Dakota v. Wayfair, Inc., the earliest month you need to include to calculate the Small Seller Exception is August 2017.

    Begin by reviewing your retail sales from August 2017 through July 2018 (12 months). If you exceed the Small Seller Exception, you must register, collect, and remit Minnesota sales tax on the first taxable retail sale into Minnesota that occurs no later than October 2018 (60 days after you exceed the Small Seller Exception).
    If you do not exceed the Small Seller Exception, repeat the review for the next 12-month period: September 2017 through August 2018.

  • What is a retail sale?Back to top

    Minnesota law defines “retail sale” to mean any sale of tangible personal property (goods or products) or taxable services, excluding those purchased for resale.

  • Will I need to collect sales tax on the sales that qualified under the Small Seller Exception?Back to top

    No, you do not need to collect sales tax on the sales made prior to exceeding the Small Seller Exception plus the 60-day period within which you must register to begin collecting and remitting sales tax on sales made into Minnesota. Your customers may owe use tax on these transactions.

  • How often will I need to file a return?Back to top

    ​Under Minnesota law, your filing frequency depends on your average total tax liability for a year. 

    Average tax liability
    Filing frequency
    Return due date
     
    Less than $100 per month or $1,200 per year
     
     
    Annual
    February 5 of the following year
    $100 to $500 per month or $1,200 to $6,000 per year
    Quarterly
     
     
    April 20, July 20, October 20 and January 20 of the following year
     
    More than $500 per month or $6,000 per year
    Monthly
    20th day of the following month
     

  • I am a remote seller and only sell through a Marketplace. Do I need to collect sales tax?Back to top

    If you only make taxable sales into Minnesota through a Marketplace and the Marketplace is collecting and remitting Minnesota sales tax on your behalf, then you do not need to register and collect Minnesota sales tax.

    If the Marketplace is not collecting Minnesota sales tax on your behalf, you must collect Minnesota sales tax on your taxable sales unless you meet the Small Seller Exception (above).

  • I am a remote seller and sell through a Marketplace, my own website and through other sources; what are my sales tax responsibilities?Back to top

    If all retail sales into Minnesota combined – including your sales made through any Marketplace, your own website, and through other sources – exceed the Small Seller Exception, then sales tax must be collected and remitted to Minnesota. You must collect and remit sales tax on your taxable sales through your website and other sources. If the Marketplace is not collecting Minnesota sales tax on your behalf, then you must also collect Minnesota sales tax on your taxable sales made through that Marketplace.

  • I am a Minnesota business and I make sales remotely to other states. Do I need to register for a permit in other states?Back to top

    Each state’s remote seller laws are different. To determine which laws apply to your business, go to the Streamlined Sales Tax - State Website and Contact Information for collection requirements in all 24 Streamlined Sales Tax states.

    If the state is not a member of Streamlined Sales Tax, we recommend you contact that state. For more information, see “What are the benefits of the Streamlined Sales Tax for my business?”

  • What effect does the Wayfair decision have on Minnesota purchasers?Back to top

    Minnesota purchasers may see an increased number of remote sellers charging sales tax.

    If a remote seller does not charge sales tax on a taxable item in Minnesota, the purchaser must report use tax on the purchase price. An individual may report the use tax on the Individual Use Tax Return, Form UT1.

  • Which of my sales are taxable in Minnesota? Back to top

    Minnesota taxes most sales of tangible personal property (goods) and some services. For a listing of taxable items and services, download the Minnesota taxability matrix.

    For more information on specific topics, see:

  • Are items taxable in Minnesota taxable in every state?Back to top

    No. Sales tax laws vary from state to state. If you have questions on what items are taxable in other states, contact that state directly.

    Streamlined Sales Tax states have uniform product definitions, but may tax those products differently. For more information, see Taxability Matrices on the Streamlined Sales Tax website.

  • What are the benefits of Streamlined Sales Tax for my business? Back to top

    Streamlined Sales Tax benefits to your business include:

    • You can use a Certified Service Provider (CSP) to calculate, collect, remit, and file sales tax returns in all member states. For more information, see “What is a Certified Service Provider?”
    • You can register at one time for all full member and associate states through the Streamlined Sales Tax Registration System (SSTRS)
    • Member states have uniform product definitions for consistency for businesses that sell in multiple states.
    The following states are Streamlined Sales Tax members:
     
    Arkansas
    Michigan
    North Dakota
    Utah
    Georgia
    Minnesota
    Ohio
    Vermont
    Indiana
    Nebraska
    Oklahoma
    Washington
    Iowa
    Nevada
    Rhode Island
    West Virginia
    Kansas
    New Jersey
    South Dakota
    Wisconsin
    Kentucky
    North Carolina
    Tennessee (associate)
    Wyoming

  • What does it mean to register through the Streamlined Sales Tax Registration System (SSTRS)? Back to top

    The SSTRS is a quick and easy way to register for a sales and use tax account in all Streamlined Sales Tax member states.

    When you register through the SSTRS, you receive sales tax accounts to collect and remit sales and use tax in all Streamlined Sales Tax full member states. You may also choose to register in any associate member states. Once you are registered, you must collect and remit sales and use taxes in those states.

  • How do I register for states that are not Streamlined Sales Tax members?Back to top

    You need to register for each non-member individually. For more information, contact each non-member state directly.

    If you use a Certified Service Provider (CSP), they may register you for non-member states. For more information, see “What is a Certified Service Provider?”

  • How do I file and pay my sales and use tax if I register through the SSTRS?Back to top

    You must file returns and make payments directly to the state where taxes are due. You will not file returns or make payments directly to Streamlined Sales Tax.

    Each state will send you registration information and filing instructions.
     
    For filing frequency information, see How often do I need to file Sales and Use Tax?
     
    Note: If you use a Certified Service Provider (CSP), they will file monthly returns and remit taxes to each state for you. If you have questions on filing or paying the taxes, contact your CSP.

  • What is a Certified Service Provider (CSP)?Back to top

    A CSP can file sales and use tax returns and remit sales taxes for you. Your business is responsible to pay use tax on its own purchases. Any business may contract with a CSP.

    CSP benefits
    • The CSP software works with your accounting system to identify which products and services are taxable, apply the appropriate tax rate, and record the transaction.
    • The CSP sets up their software with your system, prepares and files returns, and remits tax to each member state.
    • The CSP resolves any notices or audits by member states.
    • Streamlined Sales Tax member states certify the accuracy of the CSP software and provide liability relief for incorrect tax calculation based on the certification.
    • Free monthly return processing in states where you are a remote seller. If you have nexus in member states, a small fee may apply to file those returns.
    Certified CSPs
    Note: Some CSPs also provide services in non-Streamlined states. Check their websites for more information.

  • How do I know what sales tax rate to charge?Back to top

    Minnesota’s general sales tax rate is 6.875%. Local taxes may also apply. Local taxes apply to the same taxable items and services as the Minnesota general sales tax rate.

    Who is required to collect local sales and use taxes?
     
    All sellers, regardless of the seller’s location, are required to collect local sales and use taxes based on where their customer receives the taxable product or service.
     
    What local taxes do I need to collect?
     
    Local taxes you need to collect will depend on where your customer receives your product or service and if that location has a local tax. For details and to see the tools we provide to determine your total tax rate, see Local Tax Information.
     
    If you use a, CSP, they use state data to calculate the tax rate on your sales, including most local taxes.
     
    Where applicable, a seller is also required to collect and remit special local taxes. Examples include:
    • Car rental     
    • Entertainment      
    • Food and beverage     
    • Liquor      
    • Lodging   
    • Solid waste management
    For details, see Local Tax Information.
     
    I am already registered, how do I add local sales and use taxes to my return?
     

  • How do I register to collect Minnesota sales tax?Back to top

    You have several options to register depending on where you make sales.

    Minnesota Only
     
    You can register:
    Multiple States
     
    The easiest way to register for multiple states is through the Streamlined Sales Tax Registration System.
     
     
    Is there a fee to register?
     
    No. Minnesota and the Streamlined Sales Tax Registration System do not charge fees to register.

  • I am a Remote Seller; do I need to register with the Minnesota Secretary of State?Back to top

    ​No. Remote Sellers do not have to register with the Secretary of State to make taxable retail sales into Minnesota. But if you exceed the Small Seller Exemption, you must register with the Minnesota Department of Revenue to collect and remit Minnesota sales tax.

  • Do I need to apply for a permit each year?Back to top

    No. Once you receive a Minnesota Tax ID Number it remains active until you request for it to be cancelled or the Minnesota Department of Revenue revokes the sales tax permit for noncompliance. 

  • Are remote sellers subject to audits by the department?Back to top

    Remote sellers are subject to audits like any other business. For remote sellers using a CSP, the department works with the CSP for the audit. The department has no direct contact with the remote seller.