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NFTs, Crypto on the Radar of Minnesota, Michigan Tax Authorities

Sept. 7, 2022, 4:34 PM

Revenue departments in both Minnesota and Michigan have issued guidance on an issue most states have been mum about—the tax treatment of transactions involving digital assets.

The Minnesota Department of Revenue expanded the scope of its guidance addressing digital products to specify “non-fungible tokens (NFTs) are subject to sales and use tax when the underlying product (goods and services) is taxable in Minnesota.” NFTs are unique digital assets registered on a blockchain that serve as certificates of authenticity for digital products and services.

Minnesota’s guidance, presented late last week as a revision to a fact sheet addressing digital products, ...