2006 Fur Clothing Tax Includes instructions for figuring estimated payments for 2007

What’s taxable Sales to customers Payment options There is a 6.5 percent fur tax on the total outside Minnesota Electronic payments amount received from the sale of fur cloth- A Minnesota sale is any sale where the trans- If you reported more than $120,000 in ing including any shipping, transportation fer of title or possession, or both, occurs in Minnesota fur tax during the state’s previ- or finance charges (effective for sales and Minnesota. ous fiscal year (July through June), you are purchases after Dec. 31, 2001). required to make your payments electroni- Fur tax does not apply to any fur cloth- cally. This includes both estimated and M9 “Fur” means animal skin with hair, fleece or ing sale shipped from within Minnesota to return payments. fur fibers attached to it. It does not include customers outside Minnesota by common leather, suede or other animal skins where carrier or U.S. mail. You must also pay electronically if you’re the hair, fleece or fur fiber is completely required to pay any other Minnesota busi- removed. Filing requirements ness tax electronically, such as sales and Fur clothing includes clothing made of fur withholding taxes. Before you file on the hide or pelt, and other clothing with To pay electronically, use our e‑FILE Min‑ a fur component if the fur is more than You need a Minnesota tax ID. Your Minne- sota tax ID is the seven-digit number you’re nesota Internet or phone system. It’s free, three times the value of the next most valu- and there’s no registration required. able material in the clothing. assigned when you register with the Depart- ment of Revenue. To pay over the Internet, go to www.taxes. When a customer provides fur to make an state.mn.us and click on e‑FILE Minnesota. item of fur clothing, the tax also applies to If you don’t have a Minnesota tax ID, you must apply for one. Call 651-282-5225. A If you don’t have Internet access, you can labor costs to produce the clothing, as well pay by phone at 1‑800‑570‑3329. You’ll as any costs to process the fur. registration application (Form ABR) is also available on our website at www.taxes.state. need your bank routing and account num- Trade-ins. Fur tax does not apply to any mn.us. bers. trade-in allowance for fur clothing taken in To pay by other electronic payment meth- trade for resale. Form M9 annual return ods, such as ACH credit method or Fed You must file Form M9,Annual Fur Cloth- Storage, repair and maintenance. Fur tax Wire, call our office for instructions. ing Tax Return/Reconciliation, each year by does not apply to payments for storing, March 15. The U.S. postmark date, or date repairing, cleaning, applying oil treatments, Payments by check recorded or marked by a designated delivery remodeling and restyling of furs. These If you’re not required to pay electronically, service, is considered the filing date (postage costs, however, are subject to Minnesota you can pay by check. meter marks are not valid). When the due sales tax. date falls on a Saturday, Sunday, or legal holi- To make an M9 return payment by check, day, returns postmarked on the next business complete a PV51 payment voucher and Use tax day are considered on time. When a return is send it with your check and M9 return. If you purchase or receive fur clothing to filed late, the date it is received at the Depart- To make an estimated payment by check, use or store in Minnesota from a furrier ment of Revenue is treated as the date filed. complete an M73 payment voucher and who is not subject to the Minnesota tax on send it with your check. fur clothing, you owe use tax (effective for Estimated payments fur clothing purchased and brought into If you estimate your 2007 fur tax to be more Minnesota on or after Jan. 1, 2002.) than $500, you must make quarterly pay- Completing Form M9 ments based on the entire estimated amount. Minnesota allows a credit of any tax paid Line 1 on fur to another jurisdiction up to the For 2007, payments are due April 16, July 16, Fur clothing sales 6.5 percent charged by Minnesota. Only the October 15 and Jan. 15, 2008. Enter the amount received from the sale of purchaser who paid the tax imposed by the fur clothing. Include any shipping, trans- To avoid an additional charge for underpay- other jurisdiction can claim the credit. See portion or finance charges. If a customer ing estimated tax, your estimated payments instructions for line 5. provides fur to have made into an item of must equal at least: fur clothing, include any labor costs to pro- • 90 percent of one-quarter of your 2007 duce the item as well as any costs to process tax, or the fur. • 25 percent of your total tax for 2006 if you had a tax liability and were doing business the entire year. Continued next page.

 (Rev. 12/06) 2006 Fur Clothing Tax (continued)

Line 5 Line 8 Worksheet, Line 4 Credit for tax paid to another Interest If you overpay any quarter, you can subtract jurisdiction Interest is due on the total tax plus penalties the amount of the overpayment from your If you paid tax on fur to another jurisdic- from the date the tax is due until the date next quarter’s payment. If the overpayment tion at a rate lower than Minnesota’s rate, the tax is paid. The interest rate for 2007 is is more than the amount of the payment, enter the amount you paid on line 5. 8 percent. The interest rate may change for deduct the remaining amount from future 2008. payments. All overpayments at the end of If the other jurisdiction’s rate is the same or the year will be refunded. higher, enter the amount equal to the 6.5 To figure how much interest you owe, use percent rate. Attach a copy of the receipt the following formula with the appropriate showing the tax paid to the other jurisdic- interest rate: Information and tion. You are not allowed credit for VAT Interest = assistance taxes imposed in other countries. If you need information or help to complete (tax + penalty) × # of days late × interest rate ÷ 365 this form, call 651-297-1772. TTY: Call 711 Line 7 for Minnesota Relay. Penalty Figuring estimated If you send all or part of the tax after the payments for 2007 Forms are available on our website at www. due date, you must pay a penalty. taxes.state.mn.us. Your estimated payments must equal at If your payment is one to 30 days late, the least: We’ll provide information in another penalty is 5 percent of the unpaid tax; 31 to format upon request to persons with dis- • 90 percent of one-quarter of your 2007 60 days late, 10 percent; more than 60 days abilities. tax, or late, 15 percent. • 25 percent of your total tax for 2006 if Add an additional 5 percent to the above you had a tax liability and were doing penalty if you also file your M9 return late. business the entire year. Use the worksheet below to figure your pay- ments for each quarter.

How to figure estimated payments for 2007

1 Enter your estimated fur clothing tax for 2007. If less than $500, do not make estimated payments. . .1

2 Divide line 1 by four ...... 2

3 Multiply line 2 by 90% (.90) ...... 3

4 Enter 25 percent of your total fur clothing tax for 2006 ...... 4

A B C D Due April 16 Due July 16 Due Oct. 15 Due Jan. 15, 2008

5 Enter amount from line 3 or line 4 (whichever is less) in each column . . . . . 5

6 Overpayment from previous quarter, if any . . . . 6

7 Estimated payments due each quarter (subtract line 6 from line 5) ...... 7