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Massachusetts Jumps on Tax Free Train

  • Aug 7, 2013 | Gail Cole

 Massachusetts tax free weekend: a good time to buy a wedding dress.

Massachusetts may not be trying to emulate its northernly neighbor, New Hampshire, but it is joining many other states on the Sales Tax Holiday Train.

It was almost left behind. While most other states announce their sales tax holidays months in advance, Massachusetts waited until the final hour to let people know about the holiday taking place this weekend, August 10 and 11, 2013.

The sales tax exemption applies to "sales of tangible personal property bought for personal use only." And it only applies for items priced $2,500 or less. Tax is due on the entire amount for items priced higher than that.

Clothing, however, is a bit different. Under Massachusetts law, clothing costing less than $175 is exempt from sales tax. During the sales tax holiday, when single items of clothing cost more than $2,500, tax is only charged on the increment over $175.

That's a little confusing, so the Department of Revenue provides a clarifying example. During the sales tax holiday:

  • A suit purchased for $600 is exempt from all sales tax.
  • On a wedding dress purchased for $2,550, however,  tax is due on $2,375 ($2,550 - $175).

The Massachusetts sales tax holiday does not apply to all products. Sales of motor vehicles, motorboats, meals, telecommunications services, gas, steam, electricity, and tobacco products are not exempt.

Yet while you can't buy a boat tax free, you can shop in other states without worrying about use tax. In a stunning example of magnanimity, the state also applies the sales tax holiday for qualifying purchases made out-of-state. In other words, the Massachusetts taxman won't hound you for use tax on your New Hampshire Mall shopping spree, provided it takes place August 10 or 11.

How does your business prepare for last minute sales tax holidays?

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photo credit: MightyBoyBrian via photopin cc

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.