Hospital and Nursing Home Meals

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Hospitals, sanatoriums, nursing homes, assisted-living facilities, and senior homes must charge sales tax on the meals and snacks they sell to anyone other than patients or residents. This applies to sales in all facility areas, including cafeterias, coffee shops, candy stands, and vending machines.

Patient or Resident Meals

Meals and snacks normally provided to patients or residents as part of their routine care and included in the facility’s charges are exempt from tax.

Examples of exempt sales:

A patient is served a meal in their room, by facility personnel
A senior home resident eats in the facility’s dining room

If a patient or resident purchases meals or snacks in a facility area outside of their routine care, the charges are taxable.

Examples of taxable sales:

A patient purchases food from the facility snack shop
A senior home resident purchases a snack at the facilities candy stand

Note: Do not charge sales tax on meals included in the bill for the patients or residents care.

Guest Meals

Meals served to guests visiting residents are taxable. Charge sales tax if the guest pays for the meal or if the resident is billed for the meal as a separate charge.

Employee Meals

Employees meals are taxable. Charge sales tax on the amount charged to them for meals.

Vending Machine Sales

The only taxable food sold through vending machines is prepared food, soft drinks, candy, and dietary supplements. See Vending Machines and Other-Coin Operated Devices.

Cafeterias and Other Areas

All sales of food in a cafeteria or other facility areas such as a coffee shop, candy stand, or snack bar are taxable. Examples of taxable items include:

Candy and gum
Soft drinks
Heated foods (including “take-out” items)

These sales are taxable whether the area is operated by the institution or an outside organization or contractor.

Local Sales Taxes

If you are located in or make sales into an area with a local tax, you may owe local sales or use tax. See Local Sales and Use Tax.

Some areas impose a special local tax on the sale of food and beverages. See Special Local Taxes and Minneapolis Special Local Taxes.