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Time Constraints on Massachusetts Sales Tax Refunds


 No refund: Massachusetts isn't required to refund sales tax after 90 days.

Holidays mean gifts — and gifts mean returns. Some of what we collectively buy for our friends and family will not be to their taste, and some of it will be returned or exchanged. In Massachusetts, when an item is returned may determine if sales tax will be refunded.

Retailers in The Bay State are required by law to publicly post their return policy and some stores are very generous in this regard, particularly during the holidays. Yet in Massachusetts, sales tax may not be refunded if the return takes place more than 90 days after the purchase (Chapter 64H, Section 1).

As the Massachusetts Department of Revenue explains, “the state is no longer required to … credit or refund the collected sales tax to the retailer” after the 90-day threshold. Retailers may choose to refund an amount equal to the sales tax after that point, but those that do so should be aware that the amount will come out of their own pockets.

In addition, if a store has established a policy that all returns must be made within 30 or 60 days, “that time limit governs refund of the sales tax as well.”

Letter Ruling 09-4 further clarifies the state’s policy toward the refund of sales tax on returned merchandise.

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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.