General Contractor Sales and Use Tax Withholding Requirements

On this page find information on general contractor sales and use tax withholding requirements.

Requirements

• Must notify the DOR by emailing form STC-214-5 within 30 days of entering into a contract(s) with a nonresident contractor totaling $10,000 or more.
• Must notify the DOR by emailing form STC-214-5 within 30 days of entering a contract(s) with a resident contractor totaling $250,000 or more.
• Must withhold 2% of payments due a nonresident contractor having contract(s) totaling $250,000 or more UNLESS the general contractor receives confirmation of a nonresident sales and use contractor’s bond from the DOR.
• If the general contractor has no proof of nonresident performance bond received by the DOR the general contractor must withhold 2%. 

The contract has been completed by the sub-contractor. The contract was greater than $250,000 and I have proof of a nonresident performance tax bond was registered with the DOR what do I do with the 2%? 

• The subcontractor must Request for Release of Retainage (STC-214-13) from the DOR to obtain a Certificate to Release Withholding payment letter to present to the general contractor within 60 days of contract completion. 

The contract has been completed by the sub-contractor. The contract was greater than $250,000 and I have proof of a nonresident performance tax bond was registered with the DOR but it has been longer than 60 days since contract completion. What do I do with the 2%? 

• The general contractor should submit via email the Notice of Prime or General Contractor of Fund Withheld Pending Request of a Release Notice (STC-214-12). Once received by the DOR a demand retainage letter will be sent to the general or prime contractor to remit the 2% to the DOR.