Posted: Wednesday, July 30, 2008 9:54 am

Here’s a list of eligible items for Tennessee’s Sales Tax Holiday which begins at 12:01 a.m. Friday and ends 11:59 p.m. Sunday.

Eligible clothing items:
• Belts
• Caps
• Coats
• Dresses
• Gloves
• Hats
• Hosiery
• Jackets
• Jeans
• Neckties
• Pants
• Scarves
• School uniforms
• Shirts
• Shoes
• Socks
• Sneakers
• Underwear

During the holiday, clothing with a purchase price of $100 or less per item is exempt from sales tax.

Clothing items costing more than $100 or any clothing purchased for use by a trade or business is not exempt from tax. Items that are normally sold together, such as shoes, may not be split to achieve the $100 threshold.

Additionally, there is no requirement that purchases be made only for students. If an item is tax exempt, anyone may make the purchase tax–free.

Exempt clothing is defined as human wearing apparel for general use. It does not include accessories such as jewelry or bags or sports and recreational equipment like baseball gloves.

For layaway sales, qualified clothing is exempt when final payments are made by customers on items previously placed on layaway. When customers put clothing items on layaway during the holiday period, they will also be tax-exempt when final payment and delivery is made after the exemption period.

Examples of tax-free school supply items during the holiday include:
• Binders
• Book Bags/Backpacks
• Calculators
• Chalk
• Crayons
• Erasers
• Folders
• Glue
• Lunch Boxes
• Notebooks
• Paper
• Pens
• Pencils
• Rulers
• Scissors
• Tape
School Art Supplies
• Clay and Glazes
• Paints
• Paintbrushes
• Sketch and Drawing Pads
• Watercolors

During the holiday, school supplies (including school art supplies) with a purchase price of $100 or less per item are exempt from sales tax. School supplies individually priced at more than $100 or items purchased for use by a trade or business are not exempt from tax.
Items that are normally sold together may not be split to achieve the $100 threshold. Under these special
holiday laws, there is no requirement that purchases be made only for students. If an item is tax exempt, anyone may make the purchase tax–free.

School supplies are defined as items used by a student in a course of study. Specifically excluded are items such as instructional material, including reference books and school computer supplies (compact discs, printers, and printer ink).

During these holidays, computers with a purchase price of $1,500 or less, not for use in a trade or business, are exempt from tax.
Laptop computers, if priced at $1,500 or less, also qualify. Additionally, there is no requirement that purchases be made only for students. If an item is tax exempt, anyone may make the purchase tax–free.

For purposes of this exemption, a computer is defined as a central processing unit (CPU), along with various other components including monitor, keyboard, mouse, cables to connect components, and preloaded software. While the CPU may be purchased separately, other items must be part of a bundled computer package in order to be eligible. Software beyond what is preloaded with the computer package is not exempt from tax.

The following items are not exempt from tax:

• Computer parts, such as monitors, keyboards, speakers, and scanners when not sold in conjunction with a CPU

• Individually purchased software or other software not part of a preloaded software package on the initial purchase of a computer

• Storage media, such as diskette and compact disks

• Handheld electronic schedulers

• Personal digital assistants (PDAs)

• Video game consoles

• Computer printers and supplies for printers, such as paper and ink When a customer orders a computer during this period for later receipt, tax exemption is still allowed as long as the customer does not request delayed shipment. Backlogs and backorders outside the buyer's control are still tax-free. For layaway sales, qualified computer purchases are exempt when final payments are made during the holiday by customers on items previously placed on layaway. When customers put computers on layaway during the holiday period, they will also be tax-exempt when final payment and delivery is made after the exemption period.Tennessee’s 2008

Sales Tax Holiday
www.tntaxholiday.com