Landscape Agreement

Are services subject to sales tax in Massachusetts? "Goods" refers to the sale of tangible personal property, which are generally taxable. "Services" refers to the sale of labor or a non-tangible benefit. In Massachusetts, specified services are taxable.

Massachusetts imposes a five percent sales tax on retail sales of tangible personal property in Massachusetts by any vendor.As consumers of tangible personal property, construction contractors pay sales tax to their suppliers on their purchases. See Ace Heating, 371 Mass.

Massachusetts law prohibits a contractor requiring an initial deposit of over 33% of the total contract price unless special materials are ordered. Any contractor demanding over a 33% deposit should raise a huge red flag .

A: It's not uncommon for contractors to ask for a down payment up front to secure your spot on their schedule or purchase some of the job materials in advance. Asking for more than half of the project cost up front, though, is a big red flag.I recommend tying payments to progress made during the job.

If the contractor requests a large sum of money before work has begun, Mozen says you should ask specifically what types of work or materials those payments are covering.Contractors sometimes have other motives, other than purchasing materials, when they ask for large amounts of money in advance, Fowler says.

Payment Schedule In Your ContractBefore any work begins, a contractor will ask a homeowner to secure the job with a down payment. It shouldn't be more than 10-20 percent of the total cost of the job. Homeowners should never pay a contractor more than 10-20% before they've even stepped foot in their home.

Landscaping contracts should include a detailed description of the project and what exactly you will be doing. Put in writing the basic services that will be performed and also additional ones, those that will be provided for an added cost if desired.

You shouldn't pay more than 10 percent of the estimated contract price upfront, according to the Contractors State License Board.

Services in Massachusetts are generally not taxable. But watch out if the service you provide includes creating or manufacturing a product, you may have to deal with the sales tax on products. Tangible products are taxable in Massachusetts , with a few exceptions.