Taxable Purchases and Use Tax

richard.kachelmeyer Mon, 02/03/2020 - 12:50

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Taxable Purchases and Use Tax

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Items you use to operate your business are taxable unless an exemption applies. Several services are also taxable. If you do not pay sales tax on a taxable purchase, then use tax is due. See the table below for specific examples.

Taxable Purchases	Examples
General items	Computer hardware and software Furniture Hand tools (cordless drill, jig saw, hammers) Office equipment and supplies Safety equipment (hard hats, safety vests, dust masks)
Construction machinery and equipment	Bulldozers Excavators Forklifts Loaders
Advertising materials For more information, see Advertising.	Business cards Calendars Cups and mugs Pens
Taxable services	Detective and security services Laundry and cleaning services Lawn and garden care For more information, see Taxable Sales.

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Delivery Charges [+]

Building Cleaning and Maintenance [+]

Purchasing Equipment Rentals [+]

Use Tax [+]

If you buy equipment, supplies, or other taxable items for your business and the seller does not charge Minnesota sales tax, you owe use tax on the cost of the items. If your business is located in an area with a local tax, you may also owe local use tax.

Some common situations where you may owe use tax include:

You buy taxable items or services online without paying sales tax
You withdraw an item from inventory to use (instead of selling it), donate, or give away
You buy taxable items outside of Minnesota
You buy taxable items in another Minnesota city or county with a lower (or no) local sales tax

For more information, see Use Tax for Businesses and Local Sales and Use Taxes.

Taxable Purchases and Use Tax

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Taxable Purchases and Use Tax