Indiana Construction Under Time and Material Contracts

Friday, April 1st, 2016

 
 
A construction site.
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Indiana
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Indiana recently changed how sales and use tax applies to construction materials for time and material contracts.

Under a bill signed into law on March 24, 2016, a contractor is a retailer when the contractor converts tangible personal property into real property under a time and material contract. As such, a contractor must collect tax on the resale of the construction material. The contractor may purchase this material tax-free as a purchase for resale.

A "time and material contract" is defined as a contract in which the costs of labor and materials are separately stated.

This change is retroactively effective to January 1, 2010.

https://iga.in.gov/legislative/2016/bills/senate/309#document-f5def97c


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TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

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.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

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