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Tax free shopping

Updated on October 8, 2014

Tax Free Shopping

savings
savings

Tax free shopping is available in some states

The month of August reminds us of the “dog days” of summer. It is also a time to plan your big shopping excursion with the family. If you happen to be a resident in one of the eighteen states that offer a tax-free holiday, then typically August is your month to shop and save. It is usually announced as a benefit for back-to-school shopping parents but there are some restrictions on what is allowed regarding the tax-free list. So be sure to consult with your state resources and review any changes from the prior year.

There are currently about 18 states that offer a tax-free week or weekend including Texas (my home state) as one of them. Consider yourself lucky to be in Texas in August. In spite of the summer heat, it is a great time to save on sales taxes for this annual event. This is about an 8% savings or $8.00 off $100 spent. The state of Texas has been offering this tax-free weekend since 1999.


Other states that offer a tax-free weekend or week are the following;

Alabama

Arkansas

Connecticut

Florida (no longer in August, the state now has a hurricane preparedness sales holiday)

Georgia

Iowa

Louisiana

Maryland

Mississippi

Missouri

New Mexico

North Carolina (the state recently repealed its free weekend for 2014)

Oklahoma

South Carolina

Tennessee

Texas

Vermont

Virginia


Texas shopper guidelines and restrictions

For this year of 2014, the Texas shopping blitz starts August 8-10th Friday through Sunday and includes the following items that are approved as exempt from sales tax:

Clothing and footwear under $100

Backpacks for elementary and secondary kids

School supplies under $100


Some of the items that you may be surprised to find on the exempt-from-tax list are the following:

Adult and baby diapers

Bathing caps

Slippers

Panty hose

Work uniforms


Also note that if you need to put approved items into layaway during the sales tax free weekend, they will still be exempt from sales tax. This includes the approved items that are purchased online or by phone or mail. As you would expect for any busy shopping event, is helpful to catch the shopping early for the best selection and sizes.

To review an extension list of approved clothing and school items and for more details regarding the tax free weekend for Texas see the following website:

http://www.window.state.tx.us/taxinfo/taxpubs/taxholiday/d/


For a review of the other states see the corresponding state government announcement or comptrollers office. The shopping dates may vary as well as the approved items.


Get ready to shop with a budget and review:

As with any major shopping excursion, take a few moments to make a list and review the items that you have at home before you get started:

  1. Do a closet inventory for each child—pull out what does not fit from last year and donate to your favorite charity (keep the receipts for the donations on your tax return). Use some kid power to help with this process. Save yourself some time and take measurements for possible growth spurts before you get to the store, check shoe size also.
  2. Make a list of must haves for clothing and check your school for a list of required school supplies as well. Most schools will post a list of supplies for each grade on their district website or contact the school directly.
  3. Make a budget to control expenses and do some early planning to get into the stores at the start of the weekend for the best selection.
  4. Not everything for school has to be brand new--check thrift stores and garage sales for bargains also.
  5. It is helpful to have the extra savings of a tax free weekend, but don’t buy things that you don’t need.
  6. Remember that the school year runs over 9 months so spread your budget out over the year.

Summary of next steps:

  1. Make a budget or spending allowance for each child
  2. Review the list of required supplies and items
  3. Take an inventory of what you already have at home
  4. Think of the savings, make a plan, budget ahead

Tax Free for all

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