Sales Tax Holiday Common Questions

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  1. What is a sales tax holiday?

  2. When is the sales tax holiday?

  3. What items are not taxable during the sales tax holiday?

  4. What items are still taxable during the sales tax holiday?

  5. What are the product definitions?

  6. What are the administrative definitions and procedures for the sales tax holiday?

  7. Is there a listing of items that are exempt during the sales tax holiday?

  8. Is there a listing of items that are NOT exempt during the sales tax holiday?

  9. Are all retailers required to participate during the sales tax holiday?

  10. Does the exemption include items purchased online?

  11. Is a purchaser required to provide an exemption certificate to the retailer when purchasing items that are exempt during the sales tax holiday?

  12. If the price of an item is more than the threshold, is only the amount over the threshold taxable?

  13. Are exempt items that are purchased on a single invoice/receipt exempt if the total amount of all items on the invoice/receipt are over the price threshold?

  14. When filing the sales tax return, where do retailers report the amount of exempt sales during the sales tax holiday?

  15. Can a business purchase any items exempt during the sales tax holiday?

  16. Are rentals of exempt items also exempt during the sales tax holiday?

  17. If an exempt item is purchased during the sales tax holiday but delivered after, is the item exempt?

  18. Does the exemption apply to county, stadium, or premier resort area taxes?

  19. What if a purchaser is charged sales tax on an exempt item during the sales tax holiday?

  20. What if a seller does not refund the tax charged in error?


  1. What is a sales tax holiday?

    A sales tax holiday is a temporary exemption period where sales of certain items are exempt from Wisconsin sales and use tax.

  2. When is the sales tax holiday?

    The sales tax holiday will begin at 12:01 a.m. on Wednesday, August 1, 2018, and continue through 11:59 p.m. on Sunday, August 5, 2018. See Question #6 for information about different time zones.

  3. What items are not taxable during the sales tax holiday?

    During the Sales Tax Holiday, purchases of these items are not taxable:

    • Clothing – sales price of each item must be $75 or less
    • Computer purchased by a consumer for their personal use – sales price of each computer must be $750 or less
    • School computer supplies purchased by the consumer for their personal use – sales price of each item must be $250 or less
    • School supplies – sales price of each item must be $75 or less

    See the answer to Question #7 for a list of exempt items.

  4. What items are still taxable during the sales tax holiday?

    During the sales tax holiday, the following items continue to be taxable:

    • Clothing accessories or equipment
    • Protective equipment
    • School art supplies
    • School instructional materials
    • Sport or recreational equipment

    See the answer to Question #8 for a list of taxable items.

  5. What are the product definitions?

    For the sales tax holiday, the following product definitions apply:

    • "Clothing" means any wearing apparel for humans that is suitable for general use. Sales of clothing during the sales tax holiday are exempt (not taxable) if the sales price for any single item is $75 or less. See Question #7 for a list of examples.

      "Clothing" does not include the following items that are taxable during the sales tax holiday:

      • Belt buckles sold separately
      • Costume masks sold separately
      • Patches and emblems sold separately
      • Sewing equipment and supplies, including knitting needles, patterns, pins, scissors, sewing machines, sewing needles, tape measures, and thimble
      • Sewing materials that become part of clothing, including buttons, fabric, lace, thread, yarn, and zippers
      • Clothing accessories or equipment (see definition)
      • Protective equipment (see definition)
      • Sport or recreational equipment (see definition)

    • "Clothing accessories or equipment" means incidental items worn on a person or in conjunction with clothing, not including clothing, protective equipment, or sports or recreational equipment. Sales of clothing accessories and equipment are taxable during the sales tax holiday. See Question #8 for a list of examples.

    • "Computer" means a personal computer such as a laptop or desktop computer or a tablet, but not including a phone. Sales of computers are exempt during the sales tax holiday if purchased for personal use and the sales price of the computer is $750 or less. See Question #7 for a list of examples.

    • "Protective equipment" means items for human wear that are designed to protect the wearer against injury or disease or to protect property or other persons from damage or injury and are not suitable for general use. "Protective equipment" does not include items suitable for general use, clothing, clothing accessories or equipment, or sport or recreational equipment. Sales of protective equipment are taxable during the sales tax holiday. See Question #8 for a list of examples.

    • "School art supply" means items that are commonly used by a student in a course of study for artwork. Sales of school art supplies are taxable during the sales tax holiday. See Question #8 for a list of examples.

    • "School computer supply" means items that are commonly used by a student in a course of study in which a computer is used, but not including a school art supply, school supply, or school instructional material. Sales of school computer supplies are exempt during the sales tax holiday if purchased for personal use and the sales price for any single item is $250 or less. See Question #7 for a list of examples.

    • "School instructional material" means items that are commonly used by a student in a course of study as a reference and to learn the subject being taught, but not including school art supply, school computer supply, or school supply. Sales of the school instructional materials are taxable during the sales tax holiday. See Question #8 for a list of examples.

    • "School supply" means items that are commonly used by a student in a course of study, but not including a school art supply, school computer supply, or school instructional material. Sales of school supplies are exempt during the sales tax holiday if the sales price for any single item is $75 or less. See Question #7 for a list of examples.

    • "Sport or recreational equipment" means items designed for human use and worn in conjunction with an athletic or recreational activity. "Sport or recreational equipment" does not include items suitable for general use, clothing, clothing accessories or equipment. Sales of sports and recreational equipment are taxable during the sales tax holiday. See Question #8 for a list of examples.

  6. What are the administrative definitions and procedures for the sales tax holiday?

    For purpose of administering the sales tax holiday exemption, the following definitions and procedures apply:

    • "Eligible property" means an item that is exempt during the sales tax holiday.

    • "Layaway sale" means a transaction in which property is set aside for future delivery to a customer who makes a deposit, agrees to pay the balance of the sales price over time, and, at the end of the payment period, receives the property. An order is accepted for layaway by the seller when the seller removes the property from inventory or clearly identifies the property as being sold to the purchaser.

      A sale of eligible property under a layaway sales qualifies for exemption if either of the following applies:

      • Final payment on a layaway order is made by, and the property is given to, the purchaser during the sales tax holiday.
      • The purchaser selects the property and the retailer accepts the order for the item during the exemption period, for immediate delivery upon full payment, even if delivery is made after the sales tax holiday.

    • Bundled sales - The bundled transaction provisions under secs. 77.54 (51) and (52), secs. 77.51 (1f) and (3pf), and 77.52 (20), (21), (22), and (23) Wis. Stats., apply during the sales tax holiday.

    • Coupons and discounts - A discount by the seller reduces the sales price for determining the price threshold of the exempt item. A coupon that reduces the sales price is a discount if the seller is not reimbursed for the coupon amount by a 3rd party. If a discount applies to the total amount paid by a purchaser, rather than to the sales price of a particular item, and the purchaser has purchased both eligible property and taxable property, the seller must allocate the discount based on the total sales prices of the taxable property compared to the total sales prices of all property sold in that same transaction.

    • Splitting items normally sold together - Products that are normally sold as a single unit may not be divided into multiple units and sold as individual items to obtain the exemption during the sales tax holiday.

      Example: Department Store sells a pair of shoes for $100. Shoes are exempt clothing during the sales tax holiday if the sales price $75 or less. Department Store cannot sell each shoe separately for $50 to be within the sales tax holiday price threshold.

    • "Rain check" means a seller allows a purchaser to purchase an item at a certain price later because the item was out of stock.

      Eligible property that is purchased during the sales tax holiday using a rain check qualifies for the exemption regardless of when the rain check was issued. Items purchased after the sales tax holiday with a rain check are not eligible property for the sales tax holiday even if the rain check was issued during the sales tax holiday.

    • Exchanges – The procedure for an exchange with regard to the sales tax holiday are as follows:
      • If a purchaser purchases an item of eligible property during the sales tax holiday, but later exchanges the item for a similar item of eligible property, even if different in size, color, or another feature, no additional tax is due even if the exchange is made after the sales tax holiday
      • If a purchaser purchases an item of eligible property during the sales tax holiday, but after the sales tax holiday has ended, the purchaser returns the item and receives credit on the purchase of a different item, sales tax is due on the sale of the different item
      • If a purchaser purchases an item of eligible property before the sales tax holiday, but during the sales tax holiday the purchaser returns the item 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 if the new item is purchased during the sales tax holiday

    • Delivery charges - Delivery charges, including shipping, handling, and service charges, are part of the sales price of eligible property. For determining the price threshold, if all the property in a shipment qualifies as eligible property and the sales price for each item in the shipment is within the price threshold, the shipment is considered a sale of eligible property and the seller does not allocate the delivery, handling, or service charge to determine if the sales tax holiday price threshold is exceeded. If the shipment includes eligible property and taxable property, including an item of eligible property with a sales price in excess of the price threshold, the seller must allocate the delivery, handling, and service charge by using one of the following methods and apply the tax to the percentage of the delivery, handling, and service charge allocated to the taxable property:
      • A percentage based on the total sales price of the taxable property compared to the total sales price of all property in the shipment
      • A percentage based on the total weight of the taxable property compared to the total weight of all property in the shipment

    • Order date and back orders - Eligible property qualifies for exemption for the sales tax holiday if either of the following applies:
      • The item is both delivered to and paid by the customer during the sales tax holiday
      • The purchaser orders and pays for the item and the seller accepts the order during the sales tax holiday for immediate shipment, even if delivery is made after the sales tax holiday. For purposes of this paragraph, the seller accepts an order when the seller has taken action to fill the order for immediate shipment. Actions to fill an order include placement of an in-date stamp on a mail order or assignment of an order number to a telephone order. For purposes of this paragraph, an order is for immediate shipment when the customer does not request delayed shipment and regardless of whether the shipment is delayed because of a backlog of orders or because stock is currently unavailable, or on back order, by the seller.

    • Returns - For a 60-day period immediately after the sales tax holiday, when a purchaser returns an item that qualifies for the exemption, no credit for or refund of sales tax should be given unless the purchaser provides a receipt or invoice that shows tax was paid or the seller has sufficient documentation to show that tax was paid on the item.

    • Different time zones - The time zone of the seller's location determines the authorized period for the sales tax holiday when the retailer and purchaser are located in different time zones.

  7. Is there a listing of items that are exempt during the sales tax holiday?

    Sales of the following items are exempt during the sales tax holiday. Click here for a printable version of exempt listing.

    Clothing – Exempt if $75 or less per item (list is not all-inclusive)

    • Aprons, household & shop
    • Athletic supporters
    • Baby clothes
    • Baby receiving blankets
    • Bathing suits & caps
    • Beach capes & coats
    • Belts & suspenders
    • Boots
    • Coats & jackets
    • Costumes, not including costume masks sold separately
    • Diapers, including disposables
    • Dresses
    • Earmuffs
    • Footlets
    • Formal wear
    • Garters & garter belts
    • Girdles
    • Gloves & mittens for general use
    • Hats & caps
    • Hosiery
    • Insoles for shoes
    • Jeans
    • Lab coats
    • Neckties
    • Overshoes
    • Pantyhose
    • Rainwear
    • Pants & rubber pants
    • Sandals
    • Scarves
    • Shirts
    • Shoes & shoe laces, not including athletic shoes with cleats or spikes
    • Shorts
    • Slippers
    • Sneakers
    • Socks & stockings
    • Steel toed shoes
    • Sweaters
    • Sweatshirts
    • T-shirts
    • Underwear
    • Uniforms, athletic & non-athletic
    • Wedding apparel

    Computers – Exempt if for personal use and $750 or less per item (list is all-inclusive)

    • Desktop computers
    • Laptop and notebook computers
    • Tablets

    School Computer Supplies – Exempt if for personal use and $250 or less per item (list is all-inclusive)

    • Computer printers
    • Personal digital assistants, not including cellular phones
    • Computer storage media, diskettes & compact discs
    • Printer supplies for computers, printer paper & printer ink
    • Handheld electronic schedulers, not including cellular phones

    School Supplies – Exempt if $75 or less per item (list is all-inclusive)

    • Binders
    • Blackboard chalk
    • Book bags
    • Calculators
    • Cellophane tape
    • Compasses
    • Composition books
    • Crayons
    • Erasers
    • Folders
    • Glue, paste, & paste sticks
    • Highlighters
    • Index cards
    • Index card boxes
    • Legal pads
    • Loose-leaf ruled notebook paper, copy paper, graph paper, tracing paper, manila paper, colored paper, poster board, & construction paper
    • Lunch boxes
    • Markers
    • Notebooks
    • Pencils
    • Pencil boxes & other school supply boxes
    • Pencil sharpeners
    • Pens
    • Protractors
    • Rulers
    • Scissors
    • Writing tablets

  8. Is there a listing of items that are NOT exempt during the sales tax holiday?

    Sales of the following items continue to be taxable during the sales tax holiday. Click here for a printable version of taxable listing.

    Computer Related Items – Taxable (list is not all-inclusive)

    • Cases for electronic devices
    • Cellular telephones and accessories
    • Copy machines
    • Digital cameras
    • Digital media players
    • Game consoles
    • Health and fitness equipment
    • Home appliances
    • Items purchased for business use
    • Navigation equipment
    • Televisions
    • Thermostats
    • Watches

    Clothing Accessories, Clothing Equipment, and Sewing Items – Taxable (list is not all-inclusive)

    • Belt buckles sold separately from clothing
    • Briefcases
    • Cosmetics
    • Costume masks sold separately
    • Hair notions, including barrettes, hair bows & hair nets
    • Hair pieces
    • Handbags
    • Handkerchiefs
    • Jewelry
    • Nonprescription sunglasses
    • Patches & emblems sold separately
    • Sewing equipment & supplies, including knitting needles, patterns, pins, scissors, sewing machines, sewing needles, tape measures & thimbles
    • Sewing materials that become part of clothing, including buttons, fabric, lace, thread, yarn & zippers
    • Umbrellas
    • Wallets
    • Watches
    • Wigs

    Protective Equipment – Taxable (list is not all-inclusive)

    • Breathing masks
    • Clean room apparel & equipment
    • Ear & hearing protectors
    • Face shields
    • Hard hats
    • Helmets
    • Paint or dust respirators
    • Protective gloves
    • Safety belts
    • Safety glasses & goggles
    • Tool belts
    • Welders gloves & masks

    Sport or Recreational Equipment – Taxable (list is not all-inclusive)

    • Athletic shoes with cleats or spikes
    • Ballet & tap shoes
    • Gloves, including baseball, bowling, boxing, hockey & golf
    • Goggles
    • Hand & elbow guards
    • Ice Skates
    • Life preservers & vests
    • Mouth guards
    • Roller skates
    • Shin guards
    • Shoulder pads
    • Ski boots
    • Waders
    • Wetsuits & fins

    School Art Supplies – Taxable (list is all-inclusive)

    • Acrylic, tempera & oil paints
    • Clay & glazes
    • Paintbrushes
    • Sketch & drawing pads
    • Watercolors

    School Instructional Materials – Taxable (list is all-inclusive)

    • Reference books
    • Reference maps & globes
    • Textbooks
    • Workbooks

  9. Are all retailers required to participate during the sales tax holiday?

    Yes. All retailers are required to participate and may not charge tax on the exempt items during the sales tax holiday.

  10. Does the exemption include items purchased online?

    Yes. Items purchased by mail, telephone, email, online, etc., qualify for exemption if the purchaser orders and pays for the item and the seller accepts the order for immediate shipment during the sales tax holiday, even if delivery is made after the sales tax holiday

    If an item is purchased prior to the sales tax holiday , the item does not qualify for exemption even if the item is delivered during the sales tax holiday.

    See "Order date and back orders" in Question #6 for more information.

  11. Is a purchaser required to provide an exemption certificate to the retailer when purchasing items that are exempt during the sales tax holiday?

    No. A purchaser is not required to provide an exemption certificate to the retailer in order to purchase items that are exempt during the sales tax holiday.

  12. If the price of an item is more than the threshold, is only the amount over the threshold taxable?

    No. An item that is sold for more than the price threshold is taxable. For example, clothing is exempt if the sales price of any single item is no more than $75. If a pair of jeans is sold for $100 during the sales tax holiday, the entire $100 is taxable.

  13. Are exempt items that are purchased on a single invoice/receipt exempt if the total amount of all items on the invoice/receipt are over the price threshold?

    Yes. The price of each item on the invoice/receipt is used to determine if that item is under the price threshold. For example, a customer purchases three clothing items during the sales tax holiday, a pair of jeans for $60, a sweatshirt for $40, and a pair of shorts for $30. Although the total of all three clothing items on the receipt is $130, each clothing item is under the clothing threshold ($75 or less) and exempt from tax.

  14. When filing the sales tax return, where do retailers report the amount of exempt sales during the sales tax holiday?

    Retailers should include all exempt sales made during the sales tax holiday in the total sales amount on Line 1 of the Wisconsin Sales and Use Tax Return (Form ST-12). These exempt sales are included on Line 3, "Sales of exempt property and services," that get subtracted from total sales.

  15. Can a business purchase any items exempt during the sales tax holiday?

    Businesses can purchase clothing and school supplies exempt from tax during the sales tax holiday if each item is under the price threshold.

    Purchases of computers and school computer supplies by businesses are taxable since the exemption requires that these items must be purchased for the consumer's personal use. If a business is not charged sales tax by the retailer on its purchases of computers and school computer supplies, the business is liable for use tax on the purchase price of such items, unless another exemption applies (e.g., resale).

  16. Are rentals of exempt items also exempt during the sales tax holiday?

    Yes. Leases and rentals are considered a sale for Wisconsin sales tax purposes. If a lease or rental payment is for an exempt item and that item is transferred to the lessee during the sales tax holiday, that lease or rental payment is exempt from sales tax.

  17. If an exempt item is purchased during the sales tax holiday but delivered after, is the item exempt?

    Yes. The item qualifies for exemption if the purchaser orders and pays for the item and the seller accepts the order during the sales tax holiday for immediate shipment, even if delivery is made after the sales tax holiday.

    See "Order date and back orders" in Question #6 for more information.

  18. Does the exemption apply to county, stadium, or premier resort area taxes?

    Yes.  If an item is exempt from state sales and use tax during the sales tax holiday, it is also exempt from the 0.5% county sales and use tax, 0.1% baseball stadium sales and use tax, and any premier resort area tax.

  19. What if a purchaser is charged sales tax on an exempt item during the sales tax holiday?

    A purchaser that is charged tax in error should request a refund of the sales tax directly from the seller. Or, if the sales tax overpaid to all sellers is $50 or more, the purchaser may file a buyer's claim for refund directly with the Department of Revenue at https://tap.revenue.wi.gov/Buyer.

  20. What if a seller does not refund the tax charged in error?

    The purchaser should request the seller correct the error by sending a written notice to the seller. The notice must include a description of the error and any other information that the seller requires to process the request. Within 60 days from the date of the notice, the seller must refund the amount of tax collected in error and the related interest (sec. 77.59(9p)(b), Wis. Stats.).


FOR MORE INFORMATION PLEASE CONTACT:

MS 5-77
WISCONSIN DEPARTMENT OF REVENUE
Customer Service Bureau
PO Box 8949
Madison, WI 53708-8949
Phone: (608) 266-2776
Fax: (608) 267-1030
Email additional questions to DORSalesandUse@wisconsin.gov

May 15, 2018