What you need to know about this weekend’s Sales Tax Holiday
THE WOODLANDS, TX – With a fervor that rivals the mobs that swarm shopping centers on Black Friday, countless thousands of local residents are metaphorically revving their engines to prepare for Texas’ annual Sales Tax Holiday/Tax-Free Weekend. This has been an annual event since 1999.
Shoppers can save on certain qualifying items during this Friday through Sunday, August 5 - 7. State law exempts sales tax on qualified items — such as clothing, footwear, school supplies and backpacks — priced below $100, saving shoppers about $8 on every $100 they spend. The dates of the sales tax holiday and list of tax-exempt items are set by the Texas Legislature.
Here are some handy pointers to navigate the stormy seas of sales tax freedom:
• All weekend, 24/7 – From 12:01 a.m. Friday morning through 11:59 p.m. and 59 seconds on Sunday night, you can take advantage of the holiday.
• The price is right – Certain items of clothing, footwear, backpacks, and school supplies are eligible for the tax-free savings. Note that each item you purchase has to be under $100 to be eligible, so try to avoid those high-ticket items like name-brand sneakers or designer jeans if they cost more than a Franklin.
• In person, over the phone, and online – As long as the actual purchase (handing over of cash, credit card, check, or what have you, acceptance of transaction by the seller, and preparations for delivery commence) takes place during the time period of the holiday, you get the deal. So, even if you were to order something online on Saturday morning but it won’t arrive until next Thursday, you still get the tax savings as long as you click the “checkout” icon and the purchase is accepted. Note that, if your check bounces or the credit card is declined and it’s not corrected until after the weekend, you don’t get the tax benefit.
• But watch out for the extras! – Delivery, shipping, transportation, handling, and all those extra add-ons count toward the price of the item. So, let’s say you buy a jacket for $90 but the delivery fee is $15. This brings the total price of the item to $105, making it ineligible for tax savings; you’d have to pay the taxable amount. According to the State Comptroller’s website, “If a delivery charge is billed per item, and an invoice has both exempt and taxable items, only the qualifying exempt item’s delivery charge is exempt. If the delivery charge is a flat rate per package, and the amount charged is the same regardless of how many items are included in the package, the total charge can be attributed to any one of the items in the package.” It’s times like this that free shipping from outlets like Amazon Prime come in handy.
• Oops I did it again – If you accidentally pay tax on a qualifying item, you can submit a form to get reimbursed the amount you overpaid. You can download Form 00-985 – Assignment to Right to Refund from the Comptroller’s office here.
• Eight cents here, eight cents, there; sooner or later it racks up – For Woodlands area residents, sales tax is a total of 8.25 cents on the dollar. Six-point-five cents go to the State of Texas, one cent goes to The Woodlands Township, and one cent goes to The Woodlands Township Economic Development Zone. While less than a dime per dollar doesn’t seem to be much, it can add up pretty quickly; the office of Glenn Hegar, the State Comptroller, estimates that shoppers will save $112 million in state and local sales tax during this sales tax holiday.
• But keep an extra eye out for bargains NEXT weekend – As much as ‘sticking it to the man’ by not paying sales tax can bring out the patriot or rebel in the best of us (especially in these inflationary times), it might behoove you to remember that sales tax is less than ten percent here, and we can pretty much guarantee that many retail outlets will be having sales and discounts between now and the start of school than can save you anywhere from ten percent all the way to half-off, so a little patience might save you some hassle plus a little more money.
• Seller beware – If you’re a seller who charges tax on qualifying items, you can get into some serious trouble with the Comptroller’s office, so make sure you’re up on the latest protocols.
• Check it out here! – Apparel and school supplies that may be purchased tax-free are listed on the Comptroller’s website at TexasTaxHoliday.org.