Painting and Finishing Contractors - Are Your Sales Subject to Sales Tax?

Sales by a Contractor

Example A contractor sells painted or stained trim and baseboards, without installation. This sale is subject to tax.

Example A contractor is hired to supply and install painted or stained trim and baseboards in a building. This sale is not subject to tax.

*Note Tangible personal property installed in a commercial facility which primarily serves a business or process function retains its character as tangible personal property regardless of the extent that it is affixed to real property.

Example A contractor is hired to stain rails and install them on a staircase. This sale is not subject to tax.

*Note Although services to real property are generally not subject to tax, there are certain types of property that are treated as tangible personal property for purposes of repair or other service to that property. Repair and other services to these items are taxable, regardless of the extent that they are attached to or fastened to real property. A complete list of these "deemed items" can be found in Part 3.A of Publication 207, Sales and Use Tax Information for Contractors.

Example A contractor is hired to paint trim and baseboards for another contractor who will then install the property in a building. This sale is subject to tax, unless an exemption applies.

Purchase of Materials by a Contractor

Determining Whether an Item Is Tangible Personal Property or Real Property

Publication 207, Sales and Use Tax Information for Contractors, provides explanations and examples to help determine the tax treatment of services provided by contractors.

If you have questions about the sales or use tax treatment of a transaction, contact (608) 266‑2776 or DORSalesandUseTax@wisconsin.gov

Note: This document interprets provisions within secs. 77.51 and 77.52, Wis. Stats.; and sec. Tax 11.68, Wis. Adm. Code.

May 6, 2019