Transit Improvement Area Sales and Use Tax Ends September 30, 2017
We’re sending this letter to inform you of an upcoming change to the Transit Improvement Area Sales and Use Tax.
Beginning October 1, 2017, businesses making sales in the five-county area (Anoka, Dakota, Hennepin, Ramsey, Washington) must comply with changes to the Transit Improvement Sales and Use Tax collection, reporting, and remitting rates and rules.
Dates to note:
- September 30, 2017: The current .25% Transit Improvement Tax expires
- October 1, 2017:
- Hennepin and Ramsey Counties increase their Transit Improvement Tax rate to .50%.
- Anoka, Dakota, and Washington Counties remain at the .25% rate.
- Reporting requirements change (see below)
The most complicated part of this change is that each of the five counties now require the sales in their counties to be reported as separate lines on the MN Sales Tax Return in order to report the Transit Improvement Tax for each county.
If your business makes sales in multiple counties, the individual sales must be identified and tracked separately in your sales system. This is necessary to ensure correct amounts are collected and accurately reported.
If the software currently in use has the Transit Improvement Tax included as part of a “Sales Tax Group,” the use of these groups should be discontinued as of October 1, 2017. New sales tax items and new groups must be configured in order to produce correct rates and reports.
Note: Annual filers will report sales made from January 1 through September 30, 2017 on the previous Transit Improvement Tax line and sales made from October 1 through December 31, 2017 on the new separate lines for the five counties.
Boeckermann, Grafstrom & Mayer is here to help! If you need assistance to set up the new reporting for the counties in your system, please call and we will be happy to assist in any way we can.
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