Surety Deposit Requirements

A surety deposit threshold applies for businesses and state and local government units (cities, counties, and school districts) who work 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 from the contract.

For details, including exceptions to this requirement, see Withholding Tax Fact Sheet 12.