The annual sales tax holiday begins at noon on Friday, August 6th and ends at midnight on Sunday, August 8th. It’s time to take advantage of this tax-saving opportunity, whether in a traditional brick and mortar store or online. As a parent of school-aged children, this is a tax-saving opportunity for my family. However, further investigation reveals that the details of this one-off savings are a bit complicated and limited.
During the holidays, the following items are exempt from both sales tax and usage tax:
- Clothing priced under $ 75.
- School supplies priced under $ 20.When
- School materials items priced under $ 20.
Eligibility is determined on a per item basis, so there is no limit to the total purchase price. However, if the cost of the item exceeds the limit, the entire item will be subject to sales tax. Therefore, calculators and laptops that your child may need are not exempt from sales tax, but basic school supplies are exempt.
“Clothing” is defined as clothing worn by all commonly used humans.
“Clothing” includes, but is not limited to: Blouse; Sweaters; Trousers; Shorts; Skirts; Dresses; Uniforms (both athletic and non-athletic); Shoes and socks; Shoe linings; Sneakers; Sandals; Boots; Overshoes; Slippers; Steel toe shoes; Underwear; Socks and stockings; socks; panties; coats and jackets; rainwear; gloves and mittens for general use; hats and hats; ear muffs; belts and suspenders; ties; scarves; aprons (both home and store) White coats; Athletic supporters; Swimwear and caps; Beach capes and coats; Costumes; Baby receiving blankets; Both children’s and adult diapers, including disposable diapers. Rubber pants; garter and garter belt; girdle; formal wear; and wedding apparel.
Clothing is eligible for holidays, but the following items are not eligible for holidays and are taxable during the holiday period.
- Items purchased for use in trade or business.
- Clothing accessories or equipment. Clothing accessories or equipment include: Cosmetics; Hair concepts including, but not limited to, barrettes, hair bows, and hairnets. Handbags; Handkerchiefs; Jewelry; Sunglasses (no prescription); Umbrellas; Purses; Watches; Wigs and hair.
- Protective equipment.
- Sewing equipment and fixtures
- Sports or entertainment equipment. Sports or recreational equipment includes ballet shoes and tap shoes. Cleat or spike athletic shoes; gloves including, but not limited to, baseball, bowling, boxing, hockey and golf. Goggles; Hand and elbow guards; Life preservers and vests; Mouthguards; Roller skates and ice skates. Shin guards; shoulder pads; ski boots; waders; and wetsuits and fins.
- Belt buckle is sold separately.
- Costume masks are sold separately.
- Patches and emblems are sold separately.
Therefore, when you actually study the rules, you can see how complicated the rules are. Pairs of running shoes or cross trainers priced less than $ 75 are exempt from sales tax, while pairs of soccer cleats are taxable. Calculators over $ 20 are taxable, but abacus is tax exempt.
Retailers cannot split items that are normally sold together below the $ 75 threshold. So, for example, shoes cannot be sold individually to be exempt from sales tax. In addition, retailers cannot opt out of sales tax holidays and must set up their computer system to comply with sales tax holiday rules.
Sales tax holidays also apply to the same product catalogs and online purchases. Therefore, sales tax relief is available even if your children are away from town on their last vacation before returning to school.
As a parent and as a consumer, I’m happy to see this type of sales tax holiday. This sales tax holiday is intended for parents with children, but I think I’ll change some of my shorts, socks, and underwear at this point to take advantage of tax savings.
Paul Pahoresky is a partner in JLP CPA’s accounting firm and has been named Fast Track 50 for the second consecutive year as one of the fastest growing companies in Lake County and Goga County. He can be contacted at 440-974-1040×14 or at email@example.com. Talk to your tax accountant about your specific situation for additional information and guidance on these topics.
Ohio Sales Tax Holidays: What You Need To Know
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