Sales Tax Holidays
In many states, shoppers will get a tax break this month. Sales tax will not be collected on selected dates when shoppers buy school supplies, clothing and other items in at least 17 states. In some states, this break includes computers, software, and even sports equipment. An updated list is here.
Most so-called “tax holidays” last for a weekend, but Connecticut will offer tax-free shopping for seven days, starting Aug. 16. Florida’s lasts for 10 days, starting Aug. 7.
State sales taxes range from less than 2 percent to more than 7 percent. Local sales taxes can push the total to 9 percent or even higher in some areas. This adds up to significant savings for shoppers.
In addition, if you make internet purchases during this time and live in one of the eligible states, you will not be charged sales tax. For this reason, it may make sense to plan your purchases.
Sales tax holidays are typically held during the busy shopping seasons of back-to-school and holiday. However, individual states offer the same break on specific items at other times of the year. For example, Texas offers a tax holiday for energy-efficient appliances. Alabama offers tax holidays specifically for hurricane supplies. Again, if you live in an eligible state and you have a purchase in mind, it makes sense to consider buying during a holiday period.
Here’s what you need to know:
What if I shop during a tax holiday and I am charged sales tax?
You can ask the store for a refund. If you are not successful, file with the state tax authority.
Can I shop online and receive the same savings?
If you make the purchase during the tax-free period, you shouldn’t have to pay a sales tax on your eligible items.
Is there a limit to how much I can save?
Many states have a price limit on eligible items, but not a limit on the total savings. In other words, a state might limit the tax break to shoes that cost less than $100. However, you can buy as many shoes as you wish.
