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If client is in Minnesota, tax will still be collected

Gov.’s office releases more sales tax details

Myron Frans

Commissioner of Revenue Myron Frans is having a conference call with reporters at noon today to discuss Gov. Mark Dayton’s new sales tax proposal.

Ahead of that call, the Commissioner’s office released a guide, or FAQ list of the new proposals. It includes information on what would be taxed that isn’t currently and how the tax would be administered and collected.

There is some information for law firms exploring ways to get around the new business to business tax. In a nutshell, moving to Sioux Falls, S.D. won’t help you if you want to represent Target or Polaris in a Minnesota lawsuit. The tax will still be collected.

Frans’ office provides this example:

A Minnesota company hires legal counsel from a law firm located in Hudson, WI. The law firm provides legal advice and produces a memo for the company which is delivered to the company’s Minnesota office. Because the law firm does not have nexus in Minnesota, the Minnesota company is responsible for paying Minnesota use tax.

The 16-page booklet is available here.

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