Dry Cleaners, Laundries, Apparel and Linen Rental Businesses, and Similar Businesses

What Sales and Use Tax is Due?

The gross receipts derived from services rendered in engaging in any of the occupations or businesses listed below are subject to the general state and applicable local and transit rates of sales and use tax: 

• A dry cleaning, pressing, or hat-blocking establishment.
• A laundry, or any similar business.
• Clean linen towels or wearing apparel rentals, or any similar business.
• Soliciting cleaning, pressing, hat blocking, laundering or linen rental business for any of the above.

Gross Receipts Subject to Tax

The sales price of or gross receipts derived from the following are subject to tax:

• Services rendered by a dry cleaning, pressing, or hat blocking establishment, a laundry, or any similar type businesses.
• The rental of clean linen, towels, clothing, and similar items.
• Solicitation of cleaning, pressing, hat blocking, and laundering or linen rental business.
• Rug-cleaning services performed by persons operating rug-cleaning plants or performed by any of the businesses named in this section when the rug-cleaning service is performed at the plant or at the customer's location for throw rugs, area rugs, or other rugs considered tangible personal property. 
• Charges for the wash and fold laundering services or dry cleaning of linen, towels, clothing, and similar items owned by lessors that are held for lease or rental.
• Sales through coin-operated vending machines of detergents, bleaches, and similar items are taxed on 50% of the sales price. Note: Sales of tobacco products and newspapers through vending machines are taxed on 100% of the sales price. For information regarding vending machine sales, refer to SUTB 83.
• Sales of tangible personal property including any charges for labor or services rendered in applying or installing such property regardless of whether the charges are separately stated on the invoice or similar billing document given to the purchaser at the time of sale and in the retailer’s records.

Receipts Not Subject to Tax

The following receipts are not subject to tax:

• Receipts derived from coin, token, or card operated washing machines, extractors, and dryers are exempt from sales and use tax.
• Receipts derived from carpet cleaning services performed at the customer’s location for wall-to-wall carpet that are considered real property.

How to File and Pay?

Report and pay the tax due on the services listed above on Form E-500, Sales and Use Tax Return, or through the Department’s online filing and payment system.

File and pay now

How Do I Find More Resources?

• Sales and Use Tax Bulletin 53 - Laundries, Dry Cleaning Establishments, Alterations and Repairs of Clothing, Etc.