Sales Tax Holiday

Which states run them, and what they cover

There is no national list in the law, only each state’s own statute. The Streamlined Sales Tax Governing Board publishes the holidays of its member states as informational guidance and tells readers to check the state’s own site. Its page lists Arkansas (from the first Saturday in August through the following Sunday), Iowa (the first Friday and Saturday of August), Ohio (the first Friday, Saturday and Sunday of August), Oklahoma (from the first Friday in August through the following Sunday), Tennessee (the last full weekend in July) and West Virginia (from the Friday before the first Sunday in August through the following Monday).

The categories repeat from state to state: clothing and footwear, school supplies, computers, and in some states emergency supplies or energy-efficient products. The caps don’t. Ohio’s standard holiday covers clothing at $75 or less per item and school supplies at $20 or less, while the Board’s page says that in a year with a sufficient budget surplus Ohio instead runs an expanded holiday covering most tangible personal property at $500 or less. Tennessee uses $100 for clothing and $1,500 for computers.

The wording of the cap matters at the exact amount. Tennessee exempts clothing at “$100 or less per item.” Texas exempts clothing “sold for less than $100,” so a $100.00 shirt is exempt in Tennessee and taxable in Texas. Build your rules from each state’s text, not from a summary table.

The Streamlined Agreement’s rules for holidays

Section 322 of the Streamlined Sales and Use Tax Agreement sets the conditions a member state accepts if it runs a holiday. The state must not exempt anything that isn’t “specifically defined in Part II or Part III(B) of the Library of Definitions,” and the exemption has to apply uniformly to state and local tax. It must “provide notice of the exemption period at least sixty days prior to the first day of the calendar month in which the exemption period will begin.” It can’t make the exemption depend on who the buyer is or how they use the item, except that it may limit it to personal, non-business purchases. And it can’t make the seller collect an exemption certificate.

The Agreement also settles how caps work. A holiday threshold “shall include only items priced below the threshold,” and a state “shall not exempt only a portion of the price of an individual item.” An item over the cap is taxed on its full price, not on the amount above the cap.

Those rules bind member states only. Texas is not a Streamlined member, and states outside the Agreement write their own procedures, which is why the cap wording can differ the way it does between Tennessee and Texas.

Order dates, shipping, discounts and returns

Section 322 also has procedures for the cases that trip up online sellers, and states outside the Agreement often follow similar lines.

Order date. An item qualifies if it is delivered and paid for during the window, or if “the customer orders and pays for the item and the seller accepts the order during the exemption period for immediate shipment, even if delivery is made after the exemption period.” A back order still counts as immediate shipment. Texas puts it as the purchaser having “given the consideration for the item during the period.” An order where the customer asks for delayed shipment is not for immediate shipment, so it qualifies only if it is delivered and paid for inside the window.

Shipping. Delivery, shipping and handling charges are part of the sales price unless the state defines them out, and Texas says they are part of the item’s price for its cap, so a $95 item with $8 of shipping is over a $100 line. Under Section 322, a shipment where every item is eligible needs no allocation. A mixed shipment has its delivery charge split by price or weight, and only the share allocated to taxable items is taxed.

Discounts and coupons. A seller’s discount lowers the price used against the cap. A coupon counts the same way only if no third party reimburses you for it. A discount on the whole order is allocated across eligible and taxable items by their prices.

Returns and time zones. For 60 days after the holiday, a customer returning an eligible item gets no tax refund unless they show tax was paid on it. And when the buyer and seller are in different time zones, “the time zone of the seller’s location determines the authorized time period.”

What Stripe Tax does during a holiday

Stripe Tax applies holidays through your product tax codes. Stripe’s guide to tax-free weekends says it calculates tax based on where the customer is, what you sell “and whether a sales tax holiday applies at that moment,” by “matching each product’s assigned tax code against the jurisdiction’s rules in effect on that date.” It adds that the product tax code is “the part that takes the most setup.” A backpack coded as a general accessory rather than a school supply stays taxable when it should be exempt.

Stripe also publishes which holidays it supports. The sales tax holidays section of its United States tax guide lists them year by year: for 2026 it runs from Maryland’s Energy Star holiday in February to Florida’s hunting, fishing and camping holiday, which lasts through December 31, and includes Tennessee from July 31 to August 2 and the Texas back-to-school holiday from August 7 to 9. If a state where you are registered announces a holiday that isn’t on Stripe’s list, don’t assume Stripe will apply it.

When a holiday removes the tax, Stripe records why. Its zero tax guide lists product_exempt_holiday, “The transaction occurred during a US sales tax holiday,” as a taxability reason, alongside product_exempt for items exempt all year. Stripe’s tax-free weekend guide adds that “the price cap applies per item, not per transaction,” so one order can carry both taxed and exempt lines.

Three checks are worth making before a holiday weekend. First, confirm every product a holiday could cover has the right tax code, since Stripe has nothing else to go on. Second, Stripe applies a holiday only where you are registered: a state where you haven’t registered calculates no tax with or without a holiday. Third, Stripe’s docs don’t say whose clock decides an order placed near midnight, while Section 322 uses the seller’s time zone. If you have orders in the last hour of a window, look at how they were taxed.

The return, the export and QuickBooks

A holiday sale is exempt, not invisible. Stripe’s guide reminds sellers that “exempt sales still have to be reported even though no tax was collected.” Texas tells sellers to include tax-free holiday sales in Total Texas Sales (Item 1) of the return and to leave them out of Taxable Sales (Item 2). Other states have their own exempt-sales lines, and the return form decides where the number goes.

The figure comes from Stripe’s itemized tax export, which has a taxability_reason column. Filter the state’s rows for the holiday window and sum the product_exempt_holiday lines for the exempt amount. Stripe says itemized exports include non-taxable transactions unless you choose Exclude non-taxable transactions, and defines those as sales where you aren’t registered, where Stripe doesn’t support the location, or where no jurisdiction imposes tax. Check whether that option drops your holiday lines before you rely on a filtered export.

In QuickBooks, holiday sales show up as revenue with no matching tax in the sales tax liability account. That is correct, but it means the liability balance can’t tell you what to report as exempt. Keep the holiday export with the period’s return. If your gross sales for the state are reconciled against QuickBooks revenue, the exempt holiday amount is part of that gross figure, not a reconciling difference.