Understanding Tax-Free Shopping Weekends for Back-to-School Season

Millions in the U.S. are gearing up for one of the year’s busiest shopping weekends: the back-to-school season. Fortunately, several states temporarily waive sales taxes on specific purchases, allowing shoppers to save on school supplies, clothing, computers, and other essentials.

States such as Missouri, Ohio, Oklahoma, South Carolina, Texas, and Virginia are offering tax-free weekends starting this weekend. Iowa joins this list with a shorter two-day event, while Florida and Illinois have separate active tax relief periods.

Why Tax-Free Shopping Matters

These weekends offer financial relief, especially for families managing living costs while preparing for the school year. With inflation impacting budgets, tax-free periods can diminish the expense of necessary purchases. This is significant in states with high combined state and local sales tax rates.

When Do Tax-Free Weekends Happen?

Most tax-free events begin on Friday, August 7, and continue through Sunday, August 9. Iowa’s event ends on August 8. Note that dates and qualifying items vary by state.

The following states are offering traditional back-to-school tax holidays this weekend.

Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, explains that this approach eases back-to-school costs by making select items tax-free for limited days.

Active Relief Periods

Illinois and another state currently offer broader tax relief periods. Illinois, unlike most, reduces the sales tax rate on eligible items instead of a full exemption. While helpful, savings from these periods are often modest.

Michael Ryan, finance expert and founder of MichaelRyanMoney.com, illustrates: “With a 7% combined tax rate, a family spending $500 saves around $35. Yet, families should prioritize price over tax breaks.”

State rules can vary, where items like clothing and school supplies may have different dollar limits. Some states may also treat local taxes and certain products differently.

Eligible Items for Tax-Free Weekend

Eligible purchases range by state, yet generally include:

• Clothing and footwear under specific price limits
• School supplies
• Backpacks
• Computers and accessories (in some states)
• Instructional materials and learning aids (in certain states)

Texas exempts most clothing, footwear, school supplies, and backpacks under $100. Virginia includes school supplies, clothing, and footwear under set amounts, while also covering certain emergency prep and energy-efficient products. South Carolina offers a broad program for clothing, school supplies, and computers.

Ryan advises creating a school list in advance and checking state rules on qualifying items and price limits. He emphasizes comparing sale prices, noting that a 20% retailer discount outweighs a 6% to 7% sales tax waiver.

Non-Qualifying Items

Despite the tax holiday, many items remain taxable, including:

• Items above state price limits
• Jewelry and accessories in some states
• Athletic equipment
• Business-use purchases
• Products outside designated categories

States set their own exemption rules, meaning an item qualifying in one state might not in another.

Online Tax-Free Sales

Tax exemptions generally cover eligible online purchases shipped to a participating state during the tax-free period. Retailers apply exemptions based on the customer’s destination state, allowing consumers to benefit from tax-free savings both in stores and online, provided the purchase fits state criteria.

Final Notes

Shoppers in participating states have a limited timeframe for these back-to-school tax incentives, as many expire by the weekend’s end.

Contact Newsweek editors for more details: Kate Nalepinski, Trevor Davies, Sam Wilson.