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Last Updated: 8/16/2017

Miscellaneous Sales

Employee sales

Parts and repairs on employee vehicles are taxed the same as repairs for other customers. See the table below for details.

If you

Then you must

Discount the parts

Charge tax on the reduced price of the parts

Do not charge for the parts

Pay sales or use tax on your cost of the parts

Add or install something new or different at no charge

Pay sales or use tax on your cost of the parts

Sales of business equipment

Sales tax may apply if you sell or lease equipment or other items used in your business. For more information, see Fact Sheet 132, Isolated and Occasional Sales.

Sales to federal agencies

Sales to federal agencies or other federal instrumentalities are exempt from tax. The federal agency must give you a purchase order, payment voucher, work order, or a completed Form ST3, Certificate of Exemption.

For more information, see the Government – Federal and Foreign Diplomats Industry Guide.

Sales to state agencies

The state of Minnesota uses a Direct Pay Authorization. State agencies pay the Department of Revenue directly on most purchases. Purchase orders issued by Minnesota state agencies include the necessary direct pay information. Minnesota state agencies are not required to provide a completed exemption certiicate.

For more information, see the Government – State Agencies Industry Guide.

Sales to local governments

Sales to certain local governments may be taxable. To claim exemption on qualifying purchases, the local government must give you a completed Form ST3, Certificate of Exemption.

For more information, see the Government – Local Governments Industry Guide.

Sales to nonprofit organizations

Certain purchases by nonprofit organizations are exempt from tax. To claim exemption, the nonprofit must give you a completed Form ST3, Certificate of Exemption.

For more information, see the Nonprofit Organizations Industry Guide.

Other Equipment Repair Labor (not motor vehicles)

For the period of July 1, 2013 - March 31, 2014, labor to repair machinery and equipment for business use is taxable.

Examples include:

  • Boats
  • Forklifts
  • Heavy operating machinery
  • Lawn mowers/snow blowers
  • Snowmobiles/ATV’s
  • Tractors

Note: If the machinery or equipment is owned by a person and not used for a business activity, the repair labor is not taxable. You must use a reasonable method to identify if the customer is a business or an individual.

< Nontaxable Sales Warranties and Service Contracts >
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