Minnesota Revises Guidance on Repair Labor

Jan 7th, 2014

The Minnesota Department of Revenue recently revised its fact sheets on repair labor. The revisions show that labor to repair real property is not subject to tax. The old fact sheet did not address this issue.

Minnesota does not tax construction labor, which includes labor to repair real property. This means that labor to repair electronic and precision equipment is not taxable if the equipment is installed into real property. Such equipment includes HVAC systems, sprinkler systems, and light fixtures.

If a taxpayer collected sales tax from its customers on these kinds of repairs, the taxpayer may file an amended return to get a refund. The taxpayer must refund to its customers any refund from the state.

http://www.revenue.state.mn.us/businesses/sut/factsheets/FS152A.pdf