Limitations of the Sales Tax Holiday Weekend on August 11th and 12th

Newton, MA, August 08, 2007 --(PR.com)-- Governor Patrick recently signed a law that brings back the sales tax holiday for the fourth consecutive year.

The accounting team at Rodman & Rodman, P.C., of Newton, Mass. offer retailers and consumers a quick breakdown of the special rules that apply on the weekend of August 11th and 12th.

The Commonwealth of Massachusetts will not be collecting sales tax on tangible personal property sold by retailers to the general public at a price of $2,500 or less during the sales tax-free weekend.

Here’s an overview:

• The sales tax holiday excludes motor vehicles (which includes ATVs and small motorcycles), meals, motorized boats, telecommunications, gas, steam, electricity and tobacco products.
• A single item, not exceeding $2,500 maximum, will be sales tax-free. Any item with a price exceeding $2,500 will be taxed in full. For example a $3,000 television will be taxed on the entire $3,000 sale price.
• When more than one item is purchased at the same time, and each item has a price of $2,500 or less, then all of the items may be rung up on one receipt and all items are tax-free.
• Bundled items, such as computer packages that include computer, monitor, keyboard and printer in a single sales price only qualify for tax exemption if the price of the entire bundle is less than $2,500.
• There is no sales tax on clothing unless the sale price exceeds $175. For an article of clothing exceeding this amount, the $175 will be deducted from the price and the remaining amount will be taxed.
• Internet purchases are exempt from sales tax as long as they do not exceed $2,500 (and meet other criteria) and are made on August 11th or 12th Eastern Standard Time.
• Prior sales and lay-a-ways do not qualify under any circumstances. The sale has to be generated during the tax-free weekend to count.
• Business purchases are excluded, which also means any purchase made with a business check or business credit card.
• Special order items such as furniture are eligible for the sales tax holiday so long as they are ordered and paid in full on the sales tax holiday weekend, and the cost of each item is $2,500 or less, even if delivery is made at a later date.
• Car and boat rentals are considered services and do not qualify, but golf carts are eligible because they are not considered motorized vehicles.
• All services are excluded. Only tangible purchases are eligible. Airline tickets and sporting events are considered services.

For more information, visit the Department of Revenue’s website at ww.mass.gov.

Rodman & Rodman, P.C.
Founded in 1961, Rodman & Rodman, P.C. provides accounting, tax and business services to small and medium-sized companies throughout New England. With a focus on strategic planning, Rodman & Rodman goes beyond traditional accounting services and takes a proactive approach when serving clients to increase, preserve and sustain clients’ financial net worth. The firm has been designated as one of the top 50 firms by the Boston Business Journal.

From business valuations, taxation, audits, fraud detection and prevention services and succession planning to a variety of accounting IT services including software selection, implementation and training, the team at Rodman & Rodman serves as comprehensive advisors to clients. For individual clients, the company offers personal advisory services such as planning for real estate transactions, obtaining financing, estate planning and retirement planning. Rodman & Rodman Certified Public Accountants are located at 3 Newton Executive Park in Newton, Mass. For more information, visit their website at www.rodmancpa.com or contact Jen Reading at (617) 965-5959.

###