When is Texas tax

Aug 16, 2023

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HOUSTON — As kids head back to school, parents can save money by taking advantage of the Sales Tax Holiday weekend in August.

This year’s sale tax holiday begins Friday, Aug. 11, and goes through midnight Sunday, Aug. 13.

The sales tax exemption applies only to qualifying items bought during the sales tax holiday. Items bought before or after the sales tax holiday do not qualify for exemption, and there is no tax refund available.

According to the Texas Comptroller's Office, the items on the list that qualify for exemption from tax during the sales tax holiday must be priced under $100. Items that do not qualify for exemption are also included.

(T) = Taxable; (E) = Exempt

During the sales tax holiday, customers can buy most footwear and clothing sold for less than $100, tax-free. An exemption certificate is not required.

The exemption applies to each eligible item sold for less than $100, and there is no limit to the number of qualifying items customers can buy.

According to the Texas Comptroller's Office, only the school supplies on the list priced under $100 qualify for exemption from tax during the sales tax holiday.

* For kits of school supplies that contain exempt items, as well as taxable ones, the taxability depends on the value of exempt or taxable items in it. There is no limit on the number of school supplies in a kit, but if the value of the exempt items is more than the taxable ones, the kit is exempt. If the value of the taxable items is more than the exempt ones, then the kit is taxable.

The following items do not qualify for exemption during the sales tax holiday:

During the sales tax holiday, student backpacks sold for less than $100 are exempt from tax.

The exemption includes backpacks with wheels and messenger bags. Customers can buy up to 10 backpacks tax-free at one time without giving an exemption certificate to the seller.

The following items do not qualify for this exemption:

If a customer buys qualifying school supplies under a business account, they must give a properly completed Form 01-339, Texas Sales and Use Tax Exemption Certificate (PDF), to the seller.

"Under a business account" means they are:

During the sales tax holiday, customers can buy qualifying items tax-free when they:

During the sales tax holiday, customers can buy qualifying items tax-free, even if the items have to be ordered.

If a customer buys the qualifying item after the sales tax holiday, a special order made or rain check given during the sales tax holiday does not qualify the item for exemption.

During the holiday customers can buy qualifying items in-store, online, by telephone, mail, custom order, or any other means.

The sale of the item must take place during the specific dates of the Sales Tax Holiday.

The purchase date is easy to determine when the purchase is made in-store but becomes more complicated with remote purchases.

The purchaser must have given consideration for the item during the period even if the item may not be delivered until after the period is over.

For example, if a purchaser enters their credit card information in an online shopping website on Sunday, Aug. 13, 2023, at 5 p.m.to purchase qualifying school supplies, but the school supplies will not be shipped until Friday, Aug. 18, 2023, and will not arrive until Tuesday, Aug. 22, the purchase will still qualify for the exemption.

However, if the charge to the credit card is declined by the payment processor at 11 p.m. on Sunday, Aug. 13, 2023, and the purchaser does not resubmit payment until Monday, Aug. 14, the purchase is taxable.

Delivery, shipping, handling, and transportation charges by the seller are part of the item’s sales price.

Since clothing, backpacks, and school supplies have to be less than $100 to qualify, customers have to look at the item’s total sales price to determine if they can buy it tax-free.

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.

If a customer pays sales tax on qualifying items during the sales tax holiday, they can ask the seller for a refund of the tax paid.

The seller can either grant the refund or provide their customer with Form 00-985, Assignment to Right to Refund (PDF), which allows the purchaser to file the refund claim directly with the Comptroller’s office.