Minnesota Contractor Sales Tax 2026: Labor, Materials, Rules

Minnesota sales tax for contractors 2026. Labor taxable? Materials? Real rules from state revenue department.

Minnesota Contractor Sales Tax 2026

Minnesota sales tax for contractors 2026. Labor taxable? Materials? Real rules from state revenue department.

Minnesota sales tax rate for contractors

  • Combined rate: 6.875% + local (~7.5% combined avg)
  • Construction labor taxable: NO - real property labor is exempt
  • Tax authority: Minnesota Department of Revenue

How Minnesota treats contractor labor

Real property labor exempt. Some installation services on TPP are taxable.

Minnesota-specific rules

45-day pre-lien notice on residential is strict - missing it voids lien. Residential builder license required for jobs over $15K.

Minnesota mechanics lien rights

Beyond sales tax, Minnesota contractor billing must respect the mechanics lien deadline of 120 days from last work. Preliminary notice: Pre-lien notice within 45 days of first work (residential of 4 units or less).

Minnesota contractor licensing

Minnesota Department of Labor and Industry - required for licensed work. $240 (residential builder/remodeler) + $15K bond. Board: https://www.dli.mn.gov.

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Minnesota contractor resources by trade