The August back-to-school sales tax holiday wave is here

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Sales Tax Holidays are short periods of time, 1-3 days or maybe a week, throughout the year when a list of items is exempt from sales tax. Each state can set its own dates, set its own lists of exempt items, and set its own dollar thresholds. Sales tax holidays most commonly exist for back to school clothing, footwear, and school supplies, hurricane preparedness, or energy-efficient items.

Sales tax holiday, fun for consumers.

The first traditional sales tax holiday took place in New York in January 1997. Local governments were given the option of whether to participate and most of them said no!

Since 1997, nearly 25 states have held a holiday. Holidays can either get written into state law and occur on an annual basis or need legislative approval and a governor’s signature each year. Very few states –Missouri, Tennessee, Alabama — allow locals to opt out.

Are sales tax holidays fun for small business?

Sales tax holidays seem so great when you look at them from a consumer perspective. After all, who wouldn’t want to save 2-10% without a coupon? These holidays can, however, cause big headaches for retailers, especially when only specific categories of items are exempt or if thresholds apply. In these cases, it can be difficult to keep track of what does and does not qualify for an exemption and when or how to start taxing after a threshold has been met.

Sales tax holidays are also very well publicized, so consumers are expecting qualifying items to be tax-free at checkout without a hassle. Automated sales tax solutions can help by offering functionality that handles all of the nuances of sales tax holidays.

What is coming up this August?

So far in 2019, we have seen 6 spring and 3 summer sales tax holidays. Below is a list, in order by start date, of the places you will see the exemptions flying through the rest of August:

State Date Qualifying Items Thresholds
Texas August 9-11 Limited school supplies, clothing and footwear $100
Maryland August 11-17 Clothing and footwear $100
Massachusetts August 17-18 All tangible personal property $2500
Connecticut August 18-24 Clothing and footwear $100

If you live in one of these states, get your lists ready and circle the dates on your calendar so you don’t miss out. This is a once a year opportunity. Happy shopping!

This article originally appeared on the QuickBooks Resource Center and was syndicated by

Featured Image Credit: GeorgeRudy / iStock.