Surety Deposit Requirements

A surety deposit threshold applies for businesses and state and local government units (cities, counties, and school districts) who contract with non-Minnesota construction contractors.

For any contract exceeding $50,000, you must withhold 8% from the contractor’s payments and send this amount to the Minnesota Department of Revenue. We will hold the funds as surety for the payment of state taxes owed as a result of the contract.

For details, including exceptions to this requirement, see Withholding Tax Fact Sheet 12 – Surety Deposits for Non-Minnesota Construction Contractors.