Updated local sales tax requirements for Minnesota sellers

Make sure you meet updated local sales tax requirements for Minnesota sellers
If you make sales into local jurisdictions that have local sales taxes, you must now collect those taxes. This may require you to register, collect, and remit additional local taxes.

Why is this changing now?

On June 21, 2018, the U.S. Supreme Court ruled in South Dakota v. Wayfair that physical presence is not required for sellers to be responsible for sales tax collection. Now all Minnesota sellers – regardless of their location – must collect state and local sales taxes based on the location of their customer.

 

I am currently	What do I need to do?
Collecting local sales taxes because I have a physical presence or chose to voluntarily collect	Continue to collect these local taxes
Collecting local sales taxes, but only in the areas I am physically present	Register and collect any local sales taxes on sales you make into local taxing areas where you are not physically present
Not collecting any local sales taxes	Register and collect any local taxes where you make sales into local taxing areas

What does this mean for me?
You must collect local tax even if you don’t have a physical presence in a local taxing area. See the table below for scenarios.

How do I register to collect local sales taxes?

We made improvements to the e-Services Sales and Use Tax account to simplify the process of registering for local taxes. With these updates, you will be able to quickly add all Local Tax and Other Taxes at one time.

You can also add individual taxes while filing your sales and use tax return.

For details and instructions, see What’s New – e-Services

How do I calculate local sales taxes?

We offer resources to help you determine the total tax rate (state and local) on our website. You can:

• Use our online Sales Tax Rate Calculator. If you have a street address, it will identify the nine-digit ZIP code for you. Best for use when you have one or two addresses at a time.
• Download our Sales Tax Rate Spreadsheet to use at your desk. You must know the nine-digit ZIP code. Best for use when you have multiple nine-digit ZIP Codes to look up at one time.
• Download our Sales Tax Rates and Boundaries Table to program rates into your point of sale system.

When do I need to start collecting?

You must begin collecting on the beginning of your next filing cycle:

• Monthly and Quarterly filers: October 1, 2018
• Annual filers: January 1, 2019

Questions

For more information about local taxes in Minnesota, see:

• Local Tax Information
• Local Tax Rate Guide

If you have questions about local sales tax requirements, please contact us.