Contractors that Manufacturer Materials and Fixtures
For sales and use tax purposes, a manufacturer can be defined as one who converts some form of tangible (generally personal) property into another form that has a different function or purpose. Construction contractors may be regarded as manufacturers when they substantially modify materials or fixtures before installing them, rather than just buying such items in a ready-to-install state. For purposes of this article, all references to “materials” and “fixtures” will pertain to property that contractors affix or otherwise convert to realty.
Most states expect contractors to pay sales or use tax only on the costs of the physical components of […]