PURPOSE: This rule aids in the determination of who is a contractor and the Missouri use tax requirements of the contractor, his/her suppliers and vendors, and interprets and applies section 144.605(4), RSMo.

1. (1) The term contractor includes, but is not limited to, general contractors, prime contractors, subcontractors, road contractors, cost-plus contractors and specialized contractors. More specifically, a contractor means any person entering into an agreement to improve, renovate, repair, replace, erect or alter real estate. They are not classified as retailers in that they do not generally maintain a place of business where stock of tangible personal property is sold at retail to the public, other than materials kept on hand for use in the fulfillment of their contracts.
2. (2) Where use tax is involved, the outstate supplier or vendor of building materials or 12 CSR 10-4

other items is required to collect Missouri use tax from the contractor unless the contractor takes delivery outside Missouri when the materials are used, consumed or stored and commingled with the mass properties of this state. When the out-of-state supplier fails to do so, the director of revenue will hold the contractor liable and will require him to remit use tax directly to the Department of Revenue. A contractor is considered a consumer of tangible personal property purchased by him/her for the purpose of fulfilling his/her contract. Contractors who purchase tangible personal property from out-ofstate vendors for storage, use or consumption, therefore, must register with the sales tax bureau, obtain a use tax license and remit consumer’s use tax to the Department of Revenue on all such purchases.

1. (3) Contractors cannot purchase materials used to fulfill their contracts under a resale exemption certificate when the materials are to become commingled with real estate as this does not constitute a sale for resale. When a general or prime contractor subcontracts work to a subcontractor, the subcontractor becomes liable to remit consumer’s use tax on all materials purchased from outof-state vendors for use in the fulfillment of the contract.

AUTHORITY: section 144.705, RSMo 1994.* U.T. regulation 610-2 filed Oct. 28, 1975, effective Nov. 7, 1975. Refiled March 30, 1976. *Original authority: 144.705, RSMo 1959.