What’s eligible: All single, tangible items costing less than $2,500 and purchased for personal use are eligible under the tax-free promotion. Any items purchased by corporations over the weekend for business use remain taxable items. Alcoholic beverages fall under the tax-free exemption. All sales of motor vehices, boats, meals, gas, and tobacco products do not.
Clothing: There is no state sales tax on clothing unless the cost exceeds $175. In this case, on tax-free weekend, should you purchase an item of clothing exceeding the $2,500 ceiling, you will only be taxed on the cost of the item, minus $175. Mass.gov provides the following example:
“A customer buys a suit on the sales tax holiday for $600. No tax is due. A customer buys a wedding dress on the sales tax holiday for $2,550. Tax is due on $2,375 ($2,550 - $175).”
Multiple items: Because the tax-free exception relates to single items, you will not be taxed on the overall sum of your purchases. Therefore, if you buy a TV for $2,400, a receiver for $800, and a new cell phone for $199, you will still pay no tax over the weekend. However, bundled items sold as one entity (such as a computer, printer, etc.) exceeding $2,500 will not fall under the tax-free benefit.
Coupons: If you’re using a coupon on any eligible item, as long as the price is reduced below the $2,500 threshold, the tax credit is applicable.
Rentals: Because rentals are not seen as “tangible property,” they do not fall under the exception.
Internet sales: As long as the purchase is made during the tax-free weekend, they will not be subject to any additional tax.