When a nonresident general contractor enters into a contract to be performed where tangible property is going to be consumed or used in Massachusetts, a deposit must be made with the commissioner equal to 6.25% of the total amount to be paid under the contract. This can be in the form of a guarantee bond satisfactory to the commissioner or by surety check in the amount of 6.25% of the total to be paid under the contract.
If a nonresident general contractor hires nonresident subcontractors he must deduct 6.25% of all amounts payable to the nonresident subcontractor and pay it over to the commissioner or secure a bond on behalf of the subcontractor if the subcontractor has not met the bonding / surety requirement himself. The subcontractor must present a duplicate certification from the department to the general contractor to prove he has complied with the requirement.
Resident general contractors who hire nonresident subcontractors must require the subcontractor to register with the department and meet the bonding / surety requirement. Nonresident subcontractors not meeting the requirement shall have 6.25% of the total payable amount deducted by the general contractor. The general contractor will turn the 6.25% over to the commissioner on behalf of or as agent for the nonresident subcontractor, or shall furnish a bond satisfactory to the commissioner in a sum equivalent to 6.25% of the total amount payable.
Nonresident subcontractors are required to furnish a deposit or bond in an amount equal to 6.25% of the amount the subcontractor will receive under the contract. A nonresident subcontractor who does not meet this requirement shall have 6.25% of the total payable amount of the contract deducted by the general contractor. The general contractor shall turn this amount over to the commissioner on behalf of the subcontractor.