You must register and collect sales tax in Minnesota if you have a taxable presence or nexus in Minnesota, even if you are an out-of-state retailer or marketplace provider.

You have presence in Minnesota if your business does any of the following:

• Maintains a physical location in Minnesota (office, warehouse, or distribution, sales, or sample room)
• Sells products to customers in Minnesota, using the internet, mail order, or telephone, without having a physical presence in that state and does not meet the small seller exemption
• Has 200 or more retail sales shipped to Minnesota over a period of 12 consecutive months
• Has retail sales that total more than $100,000 shipped into Minnesota over a period of 12 consecutive months
• Has an employee, representative, agent, or independent contractor that does work on behalf of the retailer in Minnesota
• Facilitates the sale of taxable goods or services to customers in Minnesota on behalf of a business
• Delivers items into Minnesota in your own vehicles
• Provides taxable services in Minnesota
• Owns property in Minnesota
• Keeps inventory in a fulfillment center in Minnesota
• Is an affiliate of a Minnesota retailer that promotes or provides other services to you and your business and the retailer are related parties
• Enters into an agreement with a Minnesota resident for a commission or similar consideration and directly or indirectly refers potential buyers to the seller through website links or otherwise

Small Seller Exception

Starting October 1, 2019, Minnesota’s Small Seller Exception will require remote sellers to collect and remit sales tax if their total sales over the prior 12-month period total either:

• 200 or more retail sales shipped to Minnesota
• More than $100,000 in retail sales shipped to Minnesota

A retail sale is one sales transaction. For example, one sale into Minnesota may contain 10 items for one customer. That transaction counts as one retail sale.

Note: When calculating this exception, do not include sales where the purchaser is buying for resale. The purchaser must give you a completed, Form ST3, Certificate of Exemption claiming a resale exemption.

What if I do not make taxable sales?

If you sell only nontaxable items, you do not need to register for a sales tax account. However, if you make purchases subject to tax, you may need to register to pay use tax. See Use Tax for Businesses.

Before you make any taxable sales in Minnesota, you must register for a Minnesota Tax ID Number and a Sales and Use Tax account.

If you need a Minnesota Tax ID Number, you can apply:

• Online – Go to Business Tax Registration
• By phone – Call 651-282-5225 or 1-800-657-3605 (toll-free)

Sales Tax Account Registration

Sales tax is charged by the seller and applied to retail sales of taxable services and tangible personal property sold in Minnesota.

Sales tax is a transaction tax. The seller must look at each transaction to determine its taxability.

Sales tax is imposed at the state and local levels.

Calculating Sales Tax

To figure the sales tax rate, combine the state general tax rate (6.875%) and all applicable local tax rates (local taxes, special local taxes, and special taxes). Apply the total rate to the taxable sales price. Rate charts are available at various percentages. See Rate Charts.

• Add sales tax to the selling price. Show the tax separately on the receipt or invoice
• Include sales tax in the selling price. Mark the item “tax included” on the receipt or invoice, or post a sign indicating that tax is included.

The sales price is the total of all charges that are part of the sale. If the item or service is taxable, these items are also taxable. Examples include:

• retail price of a good or service
• fabrication labor
• delivery charges
• installation labor
• taxes and fees that are the responsibility of the seller but are passed onto the customer (credit card processing fees, environmental fees)
• tips added to the bill by the seller
• service charges
• employee fair wage charges or employee wellness charges
• surcharges (food, fuel, etc.)
• any other charges that are a condition of the sale

The sales price does not include:

• credit allowed for trade-in
• term discounts
• cash discounts
• taxes and fees legally imposed directly on the customer
• interest charges
• finance charges from an extension of credit by the lender
• coupons unless reimbursed by a third party

Most retail sales are taxable in Minnesota.

A retail sale means any sale, lease, or rental of tangible personal property (goods) for any purpose other than resale, sublease, or subrent. A retail sale also includes services for any purpose other than for resale.

Sales, leases, and rentals are taxable regardless of quantity or if the item is new or used, unless an exemption applies.

See the following table for specific examples.

All sales of tangible personal property and some services are taxable unless an exemption exists in statute or the purchaser provides a completed Form ST3, Certificate of Exemption.

Items Exempt by Law

When an item is exempt from sales or use tax by law, the seller does not have to show why no tax was charged, but must indicate the item was food, clothing, drugs, or another exempt good.

Exemption Certificates

The seller does not have to collect sales tax if the purchaser gives them a completed Form ST3, Certificate of Exemption.

Purchasers may use their own exemption certificate; it must include the customer’s:

• Name and address
• State Tax ID Number and state of issue or, as noted below:
• Federal Employer Identification Number (FEIN) if purchaser has no state Tax ID
• Driver’s license number or other state ID number, if purchaser has no state Tax ID or FEIN
• Type of business
• Reason for claiming the exemption
• Signature

You must apply to the Minnesota Department of Revenue to obtain a special exemption or to have nonprofit exempt status.

Special Exemptions

You must apply to the Minnesota Department of Revenue to obtain a special exemption for the following:

• Direct Pay authorization
• Motor Carrier Direct Pay application
• Sales tax exemption for nonprofit organizations
• Resource recovery facility exemption

Nonprofit Organizations

Nonprofit organizations may purchase some items exempt from sales tax only if they apply and are approved for Nonprofit Exempt Status – Sales Tax. They must give their vendor a completed Form ST3, Certificate of Exemption.

For more information, see Nonprofit Organizations.

It is important to keep good records to determine the correct amount of state and local tax you owe.

Your records should include:

• Bills, receipts, invoices, cash-register tapes, and any other documents that support the entries in your books
• Exemption certificates
• Shipping documents
• Worksheets used to prepare your tax returns

Filing Frequency

Your filing schedule is based on your monthly Sales and Use Tax liability, including local sales and use taxes administered by Revenue, as shown in the following table.

Due Dates

You may not receive a notice to remind you to file your return or pay your tax so it's important to remember the return due date. For a list of due dates, see Sales Tax Return Filing Due Dates.

Filing a Return

You must file your Sales and Use Tax return online through our e-Services system.

• Go to e-Services.
• Help for e-Services

Note: If you have multiple locations and file a consolidated return, you can enter the information for each location separately or attach a spreadsheet file with information for all locations. See Sales and Use Tax File Formats.

If your total receipts include sales tax, you must subtract the tax from the total receipts before filing your return.

Subtracting Sales Tax Chart

To subtract the tax, find the sales tax rate that applies to you in the table.

Then, do one of the following:

• Divide your receipts by the number listed under "divide receipts by" in the same row as your sales tax rate
• Multiply your receipts by the number listed under "multiply receipts by" in the same row as your sales tax rate

Example

All prices at your restaurant include Minnesota sales tax only. The total taxable sales at the end of the month are $10,000. Divide $10,000 by 1.06875 (or multiply by 0.93563) to remove the Minnesota sales tax.

$10,000/1.06875 = $9,357

Report $9,357 on the General Rate Sales Tax line.

We offer several payment options:

• Log in to e-Services to
  • Schedule payments from your bank account
  • Pay with your credit or debit card (fee)
  • Pay with ACH Credit
• Pay with a check and voucher
• Pay in-person with cash

Required Electronic Payments

As a Minnesota taxpayer, you have the right to clearly understand your rights and responsibilities under the law.

Learn what your rights are as a taxpayer.

Public Information

• Minnesota Tax ID Number
• Name and address under which the business is registered
• Business name and location
• Registration date
• Any registration cancellations

Private Information

Private information includes the information you provide on your sales tax return, except for the public information listed above. We cannot provide private information to others under state law without your consent, except to the Internal Revenue Service (IRS).

For more information, see Use of Information.

Identification Verification

• Name
• Address
• Minnesota Tax ID Number

If you discover an error on a previously filed Sales and Use Tax return, you must file an amended return to correct the error.

You may file an amended return up to 3.5 years from the date the original return was due.

• You did not report enough tax
• You reported too much tax
• You reported tax on the wrong line
• You incorrectly charged sales tax and have refunded the tax to the customer
• You received a Form ST3, Certificate of Exemption, from a customer to exempt a sale reported in a prior period and have refunded the tax to the customer

Do not file an amended return to request:

• Bad debt loss
• Returned checks
• A refund of Sales or Use Tax that you overpaid

Note: All amended returns are subject to review or audit by the Minnesota Department of Revenue. Keep all supporting documentation from your original and amended return.

How to File

You can amend a return in e-Services.

• Log in to e-Services and select Change a Return
• Before submitting your amended return, enter the following information when prompted:
  • Your name, phone number, and reason for filing an amended return.
  • The total amount of taxable sales or purchases due, after your adjustments. Do not enter the difference between the original return and the actual amount due.

Filing Multiple Amended Returns

If you need to amend multiple returns, you can amend each one individually or you can use Form ST11-MPA, Sales and Use Tax Multiple Period Amended Return.