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MA state sales tax holiday is back!

Posted by Andrew Chan  August 9, 2010 11:00 AM

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After being absent last year, the state sales tax holiday in Massachusetts is back for 2010. This weekend, on August 14th and 15th, consumers who purchase items that cost less than $2,500 will not have to pay the 6.25% MA sales tax on those purchases. However, certain rules apply. Here are a few of the major ones:

1) Motor vehicles, motorboats, meals, telecommunications services, gas, steam, electricity, tobacco products do not qualify for the state sales tax exemption.

2) Single items whose purchase price exceeds $2,500 do not qualify for the state sales tax exemption. Single items which exceed the $2,500 limit will be taxed on the entire purchase price not just the amount above the $2,500.

3) There is no limit to the amount of items that can qualify on a single receipt as long as the purchase price of each item is below $2,500. For example, you can purchase 3 items each costing $1,000 on the same receipt and all three items will be exempt from state sales tax.

For more information about the MA sales tax holiday and the specific rules, click here.

Keep in mind that, as with most sales tax holidays, saving 5% - 10% on a big ticket purchase is a great way to save money on items that you were already planning on purchasing. It is not necessarily a good reason to go out and purchase a big ticket item just because you can save on the sales tax. Especially since many retailers already offer 5% - 10% savings on a regular basis through their weekly sales offers.

If you don't live or shop in Massachusetts, many other states also have sales tax holidays. Here is a link to a summary of holidays by state for 2010. http://www.taxadmin.org/fta/rate/sales_holiday.html

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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ABOUT MANAGING YOUR MONEY
Local finance professionals share insights and advice on issues such as budgeting, managing debt, and retirement planning.

About the contributors

D. Abraham Ringer is a CERTIFIED FINANCIAL PLANNER practitioner and a Financial Adviser with Morgan Stanley Global Wealth Management in Boston. He is registered in MA, NH, NY and several other states to which his articles are directed. For more information please visit www.morganstanleyfa.com/ringer
Financial Planning Association™ of Massachusetts has 900 members who specialize in the financial planning process. Many of its members engage in philanthropic pro bono work in their communities, recommend legislation, elevate public awareness, promote financial literacy, and advocate for sound economic and tax policies.
Odysseas Papadimitriou is the founder of CardHub.com, a credit card and gift card marketplace, and WalletHub.com, a personal finance site. He has more than 13 years of experience in the personal finance industry, and previously served as senior director at Capital One.

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