May 23, 2016
Hello you all! Hope life is treating you well. I have few bits of news to share with you. I spoke with the very kind and helpful Val from the MDA the other day and found out that since our bill passed a year ago and came into effect on July 1st, 2015 we have had 1313 people register with the Dept. of Agriculture. I think that’s really great and hope this coming year is even more successful.
There have been a lot of questions regarding sales taxes. I’m not going to lie, even after talking to the lady at the Minnesota Revenue office, I’m still kind of confused. The number I called at the Sales and Use Tax Division is 651-296-6181 or 1-800-657-3777. I told her others would probably be calling. She was very nice about it. From what I understand, if you are selling at a Farmer’s Market or other exhibit you do need to charge sales tax on certain items. For instance if you are providing a plate or eating utensil so the item is eaten there, then it must be taxed. If you are selling jams or spices it requires a sales tax. You can refer to this fact sheet for some information on that, FS148 Tax Info. You do need to register as a Sole Proprietor to do this and when you sign up it gives you directions on how to file your sales taxes and other information you need such as keeping your gross receipts, etc. She said this tax sheet tells you how to figure out how much sales tax to charge, FS164. As for selling prepared foods like bakery items from home that are not going to be eaten on the spot, it looks like you do not need to charge a sales tax. You can refer to this tax sheet for information, 102D Prepared Food. But honestly folks, you should call your accountant or the Minnesota Revenue office for more information.
As many of you know the 2016 Minnesota Legislative session has come to a close. We had a few items that we needed clarified such as the question of becoming an LLC. and although Rep. Newberger did his best, on this subject they would not budge.
Another issue was the wording at the beginning of the MDA’s website which previously stated, ” If you operate a business out of your home you are not eligible to apply for this registration and will not be registered. Businesses include firms, partnerships, cooperatives, societies, associations, companies and corporations.” After Rep. Newberger spoke with them it now reads like this, “This registration is for individuals only (including sole-proprietorships). Businesses such as firms, partnerships, corporations, societies, associations, and companies may not be registered as a cottage food producer.”
Also, on the MDA’s Cottage Food Law FAQ sheet the question referring to home inspections was clarified and now reads, “The MDA does not intend to conduct routine regulatory inspections of homes where cottage foods are produced. However, if food sold by someone who is registered is suspected or confirmed to be a source of illness or injury, the department may investigate the location where the food was produced. Under Minnesota Law the department has the authority to enter at reasonable times any establishment where food is manufactured, processed, packed or held. Inspection and investigation activities would be limited to areas of the location where food is manufactured, processed, packed or held. Inspections may occur at farmers’ markets or community events to verify registration and that food is being sold in a manner consistent with Minnesota Food Law and Minnesota Consolidated Food Licensing Law.”
We want to give a very big thanks to Rep. Newberger for everything he does for us!
That’s all the news for today. Wishing you all a safe Memorial Day weekend and a lovely rest of May!
- Posted in: Important Updates