State taxing authority: Minnesota Department of Revenue 2023 Minnesota state sales tax rate: 6.875% Local sales tax rates? Yes Streamlined Sales and Use Tax Agreement Member? Yes Do I have to collect Minnesota sales tax from customers?
Retailers who meet these two requirements are required to collect sales tax in Minnesota:
sales tax nexus in Minnesota Sells taxable products or services in Minnesota
What creates sales tax nexus in Minnesota?
Physical presence - A location, personnel, or other in-state business activities OR
- Your retail sales exceeded $100,000 or you made 200 or more retail sales in the state in the previous 12 months Economic nexus
Read more in the
Minnesota statutes about what creates nexus.
more about sales tax nexus and when that means you’re required to collect sales tax here. Do I have to collect sales tax from Minnesota customers if I sell on Amazon, Walmart, eBay or Etsy?
No. Minnesota has a marketplace facilitator law, which means that marketplaces like Walmart or Amazon are required to collect sales tax on behalf of 3rd party sellers on their platform.
If you have sales tax nexus in Minnesota, keep in mind that you are still required to collect sales tax on your other, non-marketplace, Minnesota sales.
more about marketplace facilitator sales tax laws here. Are my products taxable in Minnesota?
Most tangible personal property is subject to sales tax. However, some necessities like food, clothing and medication are not taxable in some states. And sometimes states consider things like digital goods (eBooks, music, movies) and software-as-a-service (SaaS) taxable even though they can’t be touched or held.
Here’s how Minnesota taxes the most commonly sales tax exempt items:
Are groceries taxable in Minnesota?
No, groceries are non-taxable in Minnesota. Is clothing taxable in Minnesota?
No, clothing is non-taxable in Minnesota, but with some exceptions. Accessories, fur clothing, sports and recreational clothing and protective clothing are all taxable Are digital products taxable in Minnesota?
Yes, digital products are taxable in Minnesota. But student’s digital textbooks are not taxable. (Physical textbooks are also non-taxable in Minnesota.) Is software-as-a-service (SaaS) taxable in Minnesota?
No, SaaS is non-taxable in Minnesota. Are services taxable in Minnesota?
Most services are non-taxable, with a few exceptions.
Taxable services include:
Building cleaning and maintenance
Detective, security and alarm services
Laundry, dry cleaning and alteration services
Lawn and garden services
Motor vehicle services (towing, washing, waxing, cleaning, etc.)
Pet grooming, boarding and care services
Read more about
service taxability in Minnesota here. How to Register for a Minnesota Seller’s Permit
Register for a Minnesota seller’s permit at the
Minnesota Department of Revenue.
Go here to learn
how to register for a sales tax permit in every US state. Do I need a Minnesota seller’s permit if I only sell temporarily in the state?
In most cases, Minnesota requires that you register and collect sales tax even if you are only making temporary sales in the state. But there is an exception for very small sellers.
If you meet these guidelines, then you are
not required to register:
You sell at only one event per calendar year and that event lasts no more than three days
You make sales of $500 or less during the calendar year
The seller provides a written statement verifying the above and provides their name, address and telephone number
Read more about
sales tax for temporary vendors in Minnesota here. How to Collect Sales Tax in Minnesota
Minnesota is a
“destination-based” sales tax sourcing state. This means that when you make a taxable sale to a customer in Minnesota, you should charge the combined sales tax rate at the buyer’s ship-to address. Should you collect sales tax on shipping charges in Minnesota?
Yes. Shipping charges are subject to sales tax in Minnesota.
sales tax on shipping in every US state here. How to File and Pay Sales Tax in Minnesota
When your sales tax filing due date approaches, you can file Minnesota sales tax returns in multiple ways.
File and pay online - File online at MN e-services. Minnesota requires online filing
so you never have to look at a sales tax return again! Let Zamp handle your Minnesota sales tax filing and remittance
how to file and pay sales tax in other US states here. I didn’t collect any Minnesota sales tax this period. Do I still need to file a return?
Yes. You should still file a “zero” return with the state even if you didn’t collect any sales tax over the taxable period.
What is the penalty for filing and/or paying Minnesota sales tax late?
The penalty for
failing to file Minnesota sales tax is 5% of the tax due.
The penalty for
failing to pay Minnesota sales tax is 5% of the tax due, and an additional 5% for every 30 days or fraction of 30 days that the amount due isn’t paid in full.
If you fail to file and pay electronically, there is an additional penalty of 5% of the sales tax due.
Can I amend a Minnesota sales tax return?
Yes, you can amend a return in
MN e-services. How often will I be required to file and pay sales tax in Minnesota?
In Minnesota you will be required to file sales tax monthly, quarterly or annually. In general, the more sales you make and sales tax you collect, the more often you’ll be required to file.
Filing Frequency Average Tax Reported Monthly More than $500 per month Quarterly $100 to $500 per month Annually Less than $100 per month
If your sales tax filing due date falls on a weekend or holiday, it’s due the next business day.
Minnesota sales tax due dates
Minnesota Monthly Sales Tax Filing Due Dates
Taxable Period Filing Due Date January 2023 February 21, 2023 February 2023 March 20, 2023 March 2023 April 20, 2023 April 2023 May 22, 2023 May 2023 June 20,2023 June 2023 July 20, 2023 July 2023 August 21, 2023 August 2023 September 20, 2023 September 2023 October 20, 2023 October 2023 November 20, 2023 November 2023 December 20, 2023 December 2023 January 22, 2024 Minnesota Quarterly Sales Tax Filing Due Dates
Taxable Period Filing Due Date Q1 (Jan-March) 2023 April 20, 2023 Q2 (Apr-June) 2023 July 20, 2023 Q3 (July-Sept) 2023 October 20, 2023 Q4 (Oct-Dec) 2023 January 22, 2024 Minnesota Annual Sales Tax Filing Due Date
Taxable Period Filing Due Date Year 2023 February 5, 2024