How to Fill Out Massachusetts Form ST-5C: Contractor’s Exempt Purchases

To fill out Massachusetts Form ST-5C, enter your business name, address, and Massachusetts Sales and Use Tax Registration Number; enter the exempt customer’s name, address, and Certificate of Exemption number from their Form ST-2; check either Box 1 (agent purchase of tangible personal property for a government body or 501(c)(3)) or Box 2 (building materials and supplies for an exempt construction project) in Part C; identify the specific contract; describe the property being bought; sign and date it; and give it to the vendor with a copy of the exempt entity’s Form ST-2 at or before the sale.¹ Do this correctly and the vendor skips the 6.25% Massachusetts sales tax instead of charging it and forcing you to chase reimbursement later.

Confirm the Project Qualifies Before You Sign Anything

The certificate is only valid if the work sits inside one of the exemptions in M.G.L. c. 64H, § 6. Signing a form for a project that does not qualify is what turns a paperwork step into a tax liability.²

Work on a building owned by or held in trust for the United States, the Commonwealth, or a Massachusetts city, town, county, or public authority qualifies under § 6(d) and § 6(f), provided the structure is used exclusively for public purposes. Work on a building owned by a 501(c)(3) organization that holds a Certificate of Exemption from the Massachusetts Commissioner of Revenue qualifies under § 6(e) and § 6(f), as long as the building is used exclusively for the organization’s charitable, religious, educational, or scientific purposes. Construction or renovation of a building used directly and exclusively as an industrial plant for manufacturing tangible personal property for sale also qualifies under § 6(f); the “directly and exclusively” language is strict, so mixed-use space raises real questions.

Section 6(tt) covers a separate arrangement: consultant contractors, operating contractors, and their subcontractors who act as purchasing agents for a government body under a written contract that expressly authorizes them to buy tangible personal property on the body’s behalf, and provides for reimbursement of that cost.

If you’re unsure which subsection your project falls under, ask the exempt entity and, if needed, DOR before you buy anything under the certificate.

Filling Out Each Part of the Form

Form ST-5C is a single page you download as a free PDF from the DOR site.¹ Complete every section that applies.

Your Contractor Information

Enter your full legal business name, your physical business address, and your Massachusetts Sales and Use Tax Registration Number. The registration number ties the transaction to your DOR account and confirms you’re authorized to claim the exemption.

The Exempt Entity’s Information

Write in the exempt entity’s full name and address, along with its Certificate of Exemption number. That number appears on the entity’s Form ST-2, which DOR issues to qualifying exempt organizations. You need to attach a copy of the valid ST-2 to the ST-5C you give the vendor.³ Government agencies often don’t issue an ST-2; in that case, attach other documentation establishing the agency’s exempt status.

Part C: Choosing Box 1 or Box 2

Part C forces you to identify which type of exempt purchase you’re making, and the two boxes cover different situations.

Check Box 1 when you’re buying tangible personal property (not limited to building materials) as an agent for a government body or 501(c)(3) organization. This is the § 6(d), § 6(e), and § 6(tt) scenario, and it only works if a real agency relationship is in place under a written contract that authorizes you to purchase on the entity’s behalf and provides for reimbursement.

Check Box 2 when you’re buying building materials and supplies for construction, reconstruction, alteration, remodeling, or repair of an exempt building or structure under § 6(f). Most contractors working a public construction job, a nonprofit facility project, or a qualifying manufacturing plant build will check this one.

Project and Purchase Description

Identify the specific construction contract by name, number, or other designation. One ST-5C covers one contract; it is not a blanket certificate you can wave across multiple jobs. That same contract number or designation has to appear on your purchase orders and invoices so the vendor’s records link every purchase back to the exempt project.³ Describe the materials or equipment you’re buying with enough specificity that an auditor could later match items to the exempt job.

Signature

Sign and date the form. Your signature is what makes it a certification, and it’s what puts you on the hook if the purchases turn out to be non-exempt.

Handing the Certificate to the Vendor

Give the completed ST-5C, with the ST-2 attached, to the vendor at or before the time of sale. Timing is not optional. If the transaction closes and tax has already been charged, the vendor is under no obligation to reverse it.³ A vendor who accepts a properly completed certificate in good faith is relieved of collecting the tax, which is why vendors will check the form for completeness before honoring it.

After the sale, look at the invoice. Confirm no sales tax was charged and that the project reference appears on the receipt. File the invoice with your copy of the ST-5C. Certificate, ST-2 copy, and matching invoice are what protect you in an audit.

What the Certificate Actually Buys Tax-Free

Under § 6(f), “building materials and supplies” is broader than the materials that end up physically inside the finished building. It covers everything consumed or expended during construction on the project, plus rental charges for construction vehicles, equipment, and machinery rented specifically for use on the exempt job site or for transporting materials exclusively to that site.²

DOR’s Directive 02-16 sets a practical test: the item must be fully consumed during the project and have no remaining use to the contractor afterward.⁴ Under that test, what you can buy under Form ST-5C includes:

Wood, brick, stone, steel, and anything else incorporated into the finished structure.
Construction fuels: diesel, gasoline, propane, welding gases, and electricity used in the construction process.
Temporary on-site items that get discarded when the job ends: lumber and nails for concrete forms, temporary drainage pipes, adhesive compounds, cleaning solvents, tape, sandpaper, and bituminous concrete for temporary pathways.
Ropes, chains, wire, and welding rod, if fully consumed or left with no further use after removal.

Items that stay taxable even on an exempt project:

Hand tools, power tools, power cords, hoses, brushes, and lighting fixtures.
Replacement parts like saw blades, drill bits, grinding wheels, and parts for contractor-owned vehicles.
Office and administrative items: paper, toner, computers, phones, copiers, office trailers, storage sheds, shelving, and furniture.
Electricity and fuel used in project warehouses or office trailers rather than in the actual construction work.

The dividing principle: if you can pack it up and use it on the next job, it isn’t a building material or supply under this exemption.⁴ Buying a table saw under ST-5C because it will be used on an exempt job is misuse; buying the sandpaper you’ll throw away on that job is not.

Extra Step If Your Business Is Based Outside Massachusetts

Nonresident contractors have to clear an additional hurdle before using Form ST-5C. Under G.L. c. 64H, § 30A, a nonresident contractor must either deposit 5% of the total contract amount with the Commissioner of Revenue or post a surety bond in the same amount to secure any sales or use tax owed on materials consumed on the project.⁵ Registering as a Massachusetts vendor is not enough. You have to file a separate nonresident contractor registration.

Three waivers exist:

Contracts of $20,000 or less between the owner and general contractor. DOR aggregates contracts between the same general contractor and the same person over any 120-day period when testing this threshold.
Projects where the owner is a § 6(d) government body or § 6(e) 501(c)(3), and the contractor acts as purchasing agent; also purchases of building materials under § 6(f) for those entities.
Labor-only contracts where you supply no materials.

Even when a waiver applies, you still register with DOR and get a determination that your project qualifies.⁵

Records to Keep

Contractors and vendors both keep copies of the ST-5C, the ST-2, purchase orders, and invoices. Massachusetts requires these records to be organized and easily locatable so the Commissioner can determine whether tax is owed.⁶ The standard assessment period is three years from the filing date or due date of the return, whichever is later, but many contractors keep records for six years to cover extended assessment periods that apply when substantial understatements are involved. The longer retention is safer because the burden of proving a purchase was legitimately exempt sits on the contractor, not the vendor.

What Misuse Costs

Using ST-5C to buy materials tax-free and then diverting them to a non-exempt job creates real liability. On audit, you owe the full 6.25% sales tax on the diverted materials. Interest compounds daily at the federal short-term rate plus four percentage points; for the first quarter of 2026, that rate is 8%.⁷

Willful misuse of an exemption certificate can trigger criminal tax evasion charges carrying up to one year in prison and fines of up to $10,000 for individuals or $50,000 for corporations. Short of criminal prosecution, back taxes plus compounding interest plus civil penalties add up to considerably more than the tax would have cost paid upfront. When a project’s exempt status is uncertain, settle the question with the exempt entity and DOR before you sign the certificate.

1
Mass.gov. MA DOR Sales and Use Tax Forms
2
General Court of Massachusetts. Massachusetts General Laws Chapter 64H Section 6
3
Massachusetts Department of Revenue. Administrative Procedure AP 101 – Organizations Exempt From Sales Tax
4
Massachusetts Department of Revenue. Directive 02-16: The Meaning of Building Materials and Supplies and Construction Vehicles, Equipment and Machinery in G.L. c. 64H, s. 6(f)
5
Massachusetts Department of Revenue. Directive 05-3: Nonresident Contractors
6
Mass.gov. 830 CMR 62C.25.1: Record Retention
7
Mass.gov. TIR 25-8: Interest Rate On Overpayments And Underpayments