Ohio’s annual sales tax holiday has arrived.
This year’s weekend-long temporary tax break began on Aug. 1 at midnight and will end on Aug. 14 at 11:59 p.m.
Initially introduced in 2019 to provide relief for families preparing for the back-to-school season, the sales tax holiday has fortunately morphed into a highly anticipated event for many Ohio residents. Last year, the state legislature expanded the sales tax holiday from one week to two weeks. This year, most types of items are eligible for sale tax relief, with only six types of items excluded from the holiday.
Eligible Items
- Almost all tangible personal property priced at $500 or less is tax-free.
Exclusions
The following items will still be taxed:
- Watercraft or outboard motors
- Motor vehicles
- Alcoholic beverages
- Tobacco products
- Vapor products
- Items containing marijuana
Help for Businesses
Sales of Both Exempt and Taxable Items
If items that meet the exemption are sold with items that do not meet the exemption, for one non-itemized price, then the entire price is subject to sales tax.
If the price of the exempt and taxable items is separately stated, then the sales tax exemption can be applied to the exempt items.
Items Normally Sold as a Unit
Articles normally sold as a unit must be sold that way during the sales tax holiday. They cannot be priced separately and sold as individual items to qualify for the exemption.
Online Sales
Qualified items sold to consumers by mail, telephone, e-mail, or Internet shall qualify for the sales tax exemption if the consumer orders and pays for the item and the retailer accepts the order during the exemption period for immediate shipment, even if delivery is made after the exemption period.
Shipping and Handling
If all items in a shipment qualify as eligible items and the sales price for each is within the sales tax holiday price threshold, the shipping and handling charges are not taxable.
If the shipment includes exempt items and taxable items, the seller should allocate the shipping and handling charges by a percentage based on the total price of the taxable items to the total price of all the items in the shipment. The retailer must charge tax on the portion of the shipping and handling charges allocated to the taxable items in the shipment.
Exchanges and Returns
If a consumer buys an eligible item during the sales tax holiday and later exchanges it for the same item, the retailer should not charge sales tax even if the exchange is made after the end of the sales tax holiday.
If a consumer buys an eligible item during the sales tax holiday and returns the item after the tax holiday period for credit on the purchase of a different item, the retailer must charge sales tax on the sale of the newly purchased item, even if it would have been eligible for the exemption during the sales tax holiday.
If a consumer buys an eligible item before the holiday period but returns the item during the sales tax holiday period and receives credit on the purchase of a different item of eligible property, no sales tax is due on the sale of the new item. The retailer must provide the consumer credit for both the purchase price and sales tax paid on the item being returned.
