Minnesota Sales Tax License Revocation / Business
Shutdown Checklist
When a Minnesota business closes or stops operating, the permit must be formally cancelled with the Minnesota Department of Revenue. This process protects both the business owner and the state by ensuring that unpaid sales tax obligations are settled before the permit is permanently revoked.
What This Issue Means
A permit revocation is the formal cancellation of your authorization to collect and remit tax to
Minnesota. When the state revokes your permit, you are no longer legally permitted to operate a business that collects this tax in Minnesota.
This action appears on your business record with the Minnesota Department of Revenue and affects your ability to obtain future permits in the state. Such cancellation is a serious administrative action with legal consequences.
Why the State Issued This or Requires This
The Minnesota Department of Revenue may revoke a sales tax permit under specific statutory grounds outlined in Minnesota law. The Commissioner may revoke a permit if a person fails to comply with Chapter 297A or the sales and use tax provisions of Chapter 289A or the rules related to sales tax.
What Happens If This Is Ignored
Operating a business and making retail sales in Minnesota after permit revocation is a felony
criminal offense under Minnesota Statutes section 289A.63, subdivision 3(b). A business that
continues to make retail sales after revocation is subject to a civil penalty of $100 for each day it engages in retail sales.
What This Does NOT Mean
While revocation itself is an administrative action, operating after revocation constitutes a felony criminal offense. Revocation is not a court judgment or criminal conviction at the time it is issued.
Checklist: What to Do After Receiving Notice of
Minnesota Sales Tax License Cancellation
Follow these steps if you have received notice that your sales tax permit is being revoked or has been revoked.
- Identify the reason for revocation stated in the notice.
- Note any deadline mentioned in the correspondence.
- Record the contact information provided by the Minnesota Department of Revenue.
- Verify that the notice was served in accordance with state procedures.
Step 1: Locate and Review the Revocation Notice
Step 2: Gather All Business Sales Tax Records
Collect copies of sales tax returns filed, payment receipts, and any correspondence with the state. Review the notice to determine the exact amount claimed by the state for unpaid sales tax, penalties, and interest.
- Call the department at the phone number listed on the notice.
- Verify whether the permit is currently revoked.
- Ask whether the revocation can be reversed if the issue is resolved.
- Request clarification on what must be completed to resolve the revocation.
Step 3: Contact the Minnesota Department of Revenue
Step 4: File Any Missing Sales Tax Returns
When closing your Minnesota tax accounts, you must still file any outstanding returns. You should close tax accounts at the end of your filing cycles, whether annually, quarterly, or monthly.
- Follow the payment instructions provided by the department.
- Keep documentation of all payments made.
- Contact the department to discuss payment arrangements if you cannot pay the full
- Note that the state may offer payment agreements in some cases.
Step 5: Submit Payment for Outstanding Obligations
amount immediately.
Step 6: Understand Reinstatement Requirements
Reinstatement of a permit requires that you become current in filing and paying returns and pay a security deposit. The Commissioner shall not issue a new permit after revocation or reinstate a revoked permit unless you apply for a permit and provide reasonable evidence of intention to comply with sales and use tax laws and rules.
Step 7: Request Written Confirmation
Ask for written confirmation from the state that your account is current once all obligations are met. Document all communications with the Minnesota Department of Revenue by saving copies of letters, emails, payment confirmations, and any notices received.
- State enforcement actions and notices
- Payroll tax debt review and resolution
- Penalty and interest reduction options
- Payment plans and compliance solutions
- Representation before state tax agencies
Step 8: Close Your Account Properly If Not Reopening
To close a tax account through the e-Services portal, you must be an e-Services Master for the business. You can also email business.registration@state.mn.us or call 651-282-5225 or
1-800-657-3605.
Common Mistakes to Avoid
Ignoring the revocation notice does not resolve the issue. The state continues collection efforts, and additional penalties accumulate. Operating without a valid permit after revocation exposes you to felony charges and $100 per day civil fines. Filing incomplete or incorrect returns delays resolution because returns must include all required information for all applicable periods.
Frequently Asked Questions
Does a revoked sales tax permit mean I cannot do business in Minnesota at all?
A revoked sales tax permit specifically means you cannot collect sales tax in Minnesota. If your business does not involve selling taxable goods or services, you may be able to operate in other capacities.
Can I reactivate a revoked permit, or do I need to apply for a new one?
The Minnesota Department of Revenue can explain whether your specific permit can be reactivated or whether a new application is required. Reinstatement requires that you become current in filing and paying sales tax returns and pay a security deposit.
Am I personally liable for unpaid sales tax if my business is a corporation or LLC?
Minnesota law allows the Department of Revenue to assess personal liability for sales and use taxes against responsible persons regardless of business structure. Personal liability can be assessed against officers of corporations, members of partnerships, and individuals.
What if the state’s claim for unpaid sales tax is incorrect?
Contact the Minnesota Department of Revenue directly to dispute the amount. The department can review your records and explain how the amount was calculated.
Moving Forward
A revoked sales tax permit is a serious administrative action that ends your authority to collect sales tax in Minnesota and carries significant legal consequences if ignored. Contact the
Minnesota Department of Revenue early, file any missing returns, pay outstanding amounts, and keep careful records of all communications.
Facing State Enforcement or Payroll Tax Issues?
If you’ve received a state tax notice and aren’t sure how to respond, we can help you review your options and next steps.
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