Massachusetts Issues Guidance for Cabinet Makers

Friday, May 16th, 2014

 
 
A carpenter working on a cabinet.
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Massachusetts
General

The Massachusetts Department of Revenue recently issued a directive on sales by cabinet makers.

The directive states that cabinet makers are generally retailers of cabinets. A taxpayer acts as a retailer, not a contractor, when it sells and installs a complete unit of a standard item of tangible personal property. Because cabinet makers generally sell complete units of standard items of tangible personal property (i.e., cabinets), they are generally retailers.

Cabinet makers are not generally construction contractors or subcontractors, even when the purchaser is a construction contractor. Construction contractors are the consumers of materials that they incorporate into a real property improvement. They are not retailers. Contractors therefore pay tax on their purchase of the materials and do not collect tax from their customers on construction contracts. Because cabinet makers are generally retailers, however, they must collect sales tax on their sales of cabinets.

http://www.mass.gov/dor/businesses/help-and-resources/legal-library/directives/directives-by-years/2014-directives/dd-14-2.html


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TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

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