Missouri's Department of Revenue clarified that contractors who purchase materials for real property improvements are considered the final user, making those sales taxable. Contractors cannot charge sales tax on the lump sum contract price but may pass the cost of sales tax for materials to the homeowner. The ruling, Letter Ruling No. LR 8374, was issued on November 24, 2025.
Contractors are considered the final user of materials used in real property improvement.
No, contractors cannot charge tax on the lump sum contract price but may include the cost of sales tax for materials in the contract price.
The cost of sales tax paid by the contractor can be factored into the materials cost and passed along to the homeowner.
Letter Ruling No. LR 8374 was issued on November 24, 2025.
Yes, sales of materials to contractors are taxable because the purchases are not sold for resale as tangible personal property.
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