Sales tax on labor in Michigan: not taxed on building repairs and new construction; repairs to things and installation depend on the job

Repairing a thing in Michigan

It depends. What it turns on: whether the repair labor is separately itemized from the parts.

• “Sales price includes the following subparagraphs (i) to (vii) ... (iii) Charges by the seller for any services necessary to complete the sale, other than the following: ... (B) Labor or service charges involved in maintenance and repair work on tangible personal property of others if separately itemized.” — MCL 205.51 (General Sales Tax Act, definitions), no date on the page

Repairing a home or building in Michigan

Not taxed. A contractor repairing or improving a building is the consumer of the materials and pays 6% use tax (or sales tax to its supplier) on them; the customer is not charged sales tax. A contractor that chooses to act as a retailer charges tax on the materials and not on separately listed labor; a lump-sum bill from such a contractor is taxed in full.

• “A contractor incurs use tax liability on the storage, use, or consumption of property a contractor purchases or acquires for the constructing, altering, repairing, or improving of real estate of others in Michigan as a "consumer" of that property unless a specific exemption applies.” — Michigan Department of Treasury Contractor Manual, page date: May 2026
• “Contractors who consistently hold themselves out as retailers (by charging sales tax to their customers on the materials they affix to realty) may separately itemize labor and materials and remit sales tax on the retail selling price of the materials. A lump sum billing that does not separately itemize installation labor and materials is subject to sales tax on the total charge.” — Michigan Department of Treasury Contractor Manual, page date: May 2026

Installation work in Michigan

It depends. Since April 26, 2023, installation charges are not taxed if they are listed separately on the invoice and your books match. What it turns on: whether the installation charge is separately itemized on the invoice and the seller's books/records support the split.

• “Public Act 20 and Public Act 21 of 2023 changed the tax treatment of most delivery and installation charges in Michigan. Beginning April 26, 2023, most delivery and installation charges are not subject to sales and use taxes as long as the seller (i.e., the taxpayer): separately itemizes delivery and installation charges on an invoice to the customer.” — Michigan Treasury: Delivery and Installation Charges, no date on the page
• “Because the delivery and installation charges were not separately stated, the delivery/installation fees are included in the sales price and are taxable.” — Michigan Treasury: Delivery and Installation Charges, no date on the page

New construction in Michigan

Not taxed. Construction contractors are consumers of the materials and pay use tax (generally 6% of the materials' cost) or sales tax to their supplier; no sales tax is charged to the customer.

• “A contractor incurs use tax liability on the storage, use, or consumption of property a contractor purchases or acquires for the constructing, altering, repairing, or improving of real estate of others in Michigan as a "consumer" of that property unless a specific exemption applies.” — Michigan Department of Treasury Contractor Manual, page date: May 2026
• “As a consumer, a real property contractor incurs use tax responsibilities. Its use tax obligation is generally 6% of the cost of materials used in the job.” — Michigan Department of Treasury Contractor Manual, page date: May 2026

Listing labor separately on the bill in Michigan

Changes the answer. Separately itemized repair labor and installation charges are left out of the taxable price; lumped together with the parts or item, they are taxed.

• “Sales price includes the following subparagraphs (i) to (vii) ... (iii) Charges by the seller for any services necessary to complete the sale, other than the following: ... (B) Labor or service charges involved in maintenance and repair work on tangible personal property of others if separately itemized.” — MCL 205.51 (General Sales Tax Act, definitions), no date on the page
• “Public Act 20 and Public Act 21 of 2023 changed the tax treatment of most delivery and installation charges in Michigan. Beginning April 26, 2023, most delivery and installation charges are not subject to sales and use taxes as long as the seller (i.e., the taxpayer): separately itemizes delivery and installation charges on an invoice to the customer.” — Michigan Treasury: Delivery and Installation Charges, no date on the page
• “Because the delivery and installation charges were not separately stated, the delivery/installation fees are included in the sales price and are taxable.” — Michigan Treasury: Delivery and Installation Charges, no date on the page
• “Contractors who consistently hold themselves out as retailers (by charging sales tax to their customers on the materials they affix to realty) may separately itemize labor and materials and remit sales tax on the retail selling price of the materials. A lump sum billing that does not separately itemize installation labor and materials is subject to sales tax on the total charge.” — Michigan Department of Treasury Contractor Manual, page date: May 2026

Materials on jobs in Michigan

Either: by default the real property contractor is the consumer and pays use tax (generally 6% of materials' cost) or sales tax to its vendor; a contractor that consistently holds itself out as a retailer may buy materials for resale and collect sales tax on them.

• “A contractor incurs use tax liability on the storage, use, or consumption of property a contractor purchases or acquires for the constructing, altering, repairing, or improving of real estate of others in Michigan as a "consumer" of that property unless a specific exemption applies.” — Michigan Department of Treasury Contractor Manual, page date: May 2026
• “As a consumer, a real property contractor incurs use tax responsibilities. Its use tax obligation is generally 6% of the cost of materials used in the job.” — Michigan Department of Treasury Contractor Manual, page date: May 2026
• “Contractors who consistently hold themselves out as retailers (by charging sales tax to their customers on the materials they affix to realty) may separately itemize labor and materials and remit sales tax on the retail selling price of the materials. A lump sum billing that does not separately itemize installation labor and materials is subject to sales tax on the total charge.” — Michigan Department of Treasury Contractor Manual, page date: May 2026

Trade services Michigan taxes

Not checked here. No official Michigan list of taxed trade services was checked.

What was not checked for Michigan

• No current Michigan Treasury page names repair labor on things in plain words, so that answer rests on the statute, MCL 205.51.

Check with the Michigan Department of Treasury

Before you bill: check with the Michigan Department of Treasury. As of November 6, 2026.

This is a plain-words summary of each state's own revenue guidance as of November 6, 2026, not tax advice. Rules have exceptions, and cities and counties can add taxes of their own. Check with the state's tax department, linked on every state's page, before you bill.

Compare Michigan with every state's answer, or with its neighbours just below.

Next door to Michigan

• Indiana: home repair not taxed, installation depends
• Ohio: home repair depends, installation depends
• Wisconsin: home repair depends, installation depends

Official sources for Michigan

• MCL 205.51 (General Sales Tax Act, definitions) — no date shown
• Michigan Treasury: Delivery and Installation Charges — no date shown
• Michigan Department of Treasury Contractor Manual — May 2026

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