State tax holidays: Is your state on the list?
Cash-strapped states are eager to raise revenue these days. Even so, 17 of them have decided they'll take a quick break from collecting sales tax to boost retail sales as students gear up for the new school year. Many states will exempt the sale of some school-related items, like clothing, computers, and supplies, from state taxes for a brief period, usually a weekend. A few state tax holidays extend to other items as well or last an entire week.
Such holidays have been around for more than 10 years and popular for the past five. The participating states vary a little from year to year. Arkansas is the only new adopter for 2011.
Before setting out to buy a new laptop or a pair of back-to-school kicks, check to see if your state (or one nearby) will be observing a tax holiday this summer. It could save you hundreds.
Here are the states holding tax holidays this summers:
Alabama: The tax break is scheduled for Friday, Aug. 5, to Sunday, Aug 7. The usual sales tax of 4 percent will be suspended for: clothing items that cost up to $100, computers that cost less than $750, books that cost less than $30, and other school supplies that cost less than $50.
Arkansas: Beginning this year, the state will have an annual tax holiday during the first weekend of August, which is Aug. 5 to 7 this time around. All school supplies, including art and instructional material, are exempt from the usual 6 percent sales tax. Additionally, clothing and footwear that cost less than $100 per item are exempt, as well as clothing accessories and equipment that cost less than $50 each.
Connecticut: Connecticut is one of just two states to observe a week-long holiday. The grace period from the state's 6 percent sales tax lasts from Sunday, Aug. 21 to Saturday, Aug. 27. It includes clothing and footwear that cost less than $300 per item.
Florida: Clothing and footwear, which costs less than $75 per item, and school supplies, which cost less than $15 per item, will be exempt from state and local taxes of up to 7.5 percent from Friday, Aug. 12, to Sunday, Aug. 14. The holiday does not apply to books, nor does it apply to items sold inside theme parks or airports.
Iowa: For just two days, Friday Aug. 5 and Saturday Aug. 6, footwear and clothing costing less than $100 per item will be exempt from state and local sales tax, which can total up to 7 percent.
Louisiana: Louisiana’s tax holiday isn’t particularly long – just two days – but it’s the most liberal. On Friday Aug. 5 and Saturday Aug. 6, the first $2,500 toward the purchase of most tangible, personal properties will be exempt from the state’s 4 percent sales tax. Local taxes may apply, and the exemption does not count for items purchased for business use.
Maryland: Like Connecticut, Maryland’s tax holiday lasts for seven days: Sunday, Aug. 14 to Saturday, Aug. 20. The state’s 6 percent sales tax won’t apply to the purchase of clothing and footwear that costs less than $100.
Massachusetts: Signed into law just in time for back-to-school shopping, Massachusetts will observe two days of tax free shopping, on Aug. 13 and 14. Nearly as generous as Louisiana, Massachusetts will lift its 6.25 percent sales tax on almost any tangible, personal property, costing less than $2,500.
Mississippi: This state held its holiday earlier than the rest. On July 29 and 30, Mississippi lifted its 7 percent state sales tax on footwear and clothing that cost less than $100.
Missouri: The three-day tax holiday in Missouri is scheduled for Friday Aug. 5 to Sunday Aug. 7. Items that are exempt from the state’s sales tax of about 4 percent are: clothing that costs up to $100, school supplies that cost up to $50, computer software that costs up to $350, and computers and hardware up to $3,500. Local sales taxes, of up to an additional 5 percent, may still be charged.
New Mexico: From Friday Aug. 5 to Sunday Aug. 7, New Mexico will suspend its sales tax of about 5 percent on clothing and footwear costing less than $100, computers costing less than $1,000, computer accessories costing less than $500, school supplies costing less than $15, and some special school supplies costing less than $100.
North Carolina: Like many other states, North Carolina will give a break from its 5.75 percent sales tax during the first weekend in August, from the 5th to the 7th . Items exempt from taxes during that period are: clothing, footwear, and school supplies that cost less than $100, school instructional material costing less than $300, computers costing less than $3,500, and computer supplies costing less than $250. North Carolina is one of the only states to also include sports and recreation equipment (that costs less than $50) on the list of exemptions.
Oklahoma: This state’s holiday is during the most popular time as well, Aug. 5 through 7, and the items exempt from the 4.5 percent state sales tax are straightforward: clothing and footwear that cost less than $100 per item.
South Carolina: Also taking place during the first weekend in August, South Carolina’s holiday includes a variety of items and does not put price limits on the exemptions. Included on the list are: clothing, accessories, footwear, computers, printers, software, and some bed and bath items. Shoppers can save up to 9 percent from the break on state and local taxes.
Tennessee: Tennessee will suspend its state and local taxes of up to 9.75 percent for the first weekend in August for clothing and school supplies that cost $100 or less and computers that cost $1,500 or less.
Texas: The tax-free weekend in Texas comes during the third weekend in August, from the 19th through the 21st . The holiday from up to 8.25 percent in state and local sales taxes applies to most clothing, footwear, and backpacks under $100. The exemption also counts for certain school supplies that cost less than $100 each.
Virginia: The back-to-school tax break in Virginia last three days during the first weekend of August. Certain clothing and footwear, costing $100 or less, are exempt from the state’s 5 percent sales tax, as are certain school supplies costing $20 or less.
