Glossary · Forms & Certificates
Form 5088 — MRRA Contractor Notice of Tax Responsibility
In short
The optional notice by which a contractor designates a project as MRRA and records that the subcontractor owes the tax on materials it incorporates.
In full
Form 5088 is the Contractor Notice of Tax Responsibility (MRRA). It does two things: it designates a contracting project as MRRA, and it records between the contractor and the subcontractor that the subcontractor is responsible for the tax on the materials it purchases and incorporates. Both parties sign it and both retain a copy.
ADOR describes it as optional but highly recommended. It applies to a single project; additional projects require additional notices.
Its precondition is a forecast. The form states it should be used only where there is a reasonable expectation that the project is maintenance, repair or replacement, or that the alteration is unlikely to exceed the threshold. A notice issued on a project that then converts has a defined exit, printed on the form.
Note Three settles what happens on conversion. Where the project becomes a modification project, the contractor who signed the notice is required to notify the subcontractor by issuing Form 5005, and the notice is automatically revoked. The subcontractor, on receiving the Form 5005, must complete the Affidavit of Retail TPT Equivalent Paid by the Subcontractor and provide it to the contractor who hired them. The 5088 does not survive the conversion, so a contractor is not left holding two certificates that assign the materials tax in opposite directions.
Note Two carries the record-keeping consequence. Where tax was not paid at the time of purchase, the subcontractor retains its materials receipts to calculate what is owed and reports the retail equivalent under business code 315. Where tax was paid at purchase, the receipts substantiate that and nothing further is owed.
Arizona Form 5088-MRRA, Contractor Notice of Tax Responsibility (MRRA) (ADOR 11421, 2/24)