News : Tax-Free holiday coming soon; how to make the most of the benefit

On August 5-6, no Iowasales tax will be charged on clothing and footwear priced below $100. The exemption also applies to local option sales tax.

A family that spends $500 on clothing during the back-to-school season could save $30 or more in sales tax if they make their purchases on those days.

The exemption applies to “any article of wearing apparel and typical footwear intended to be worn on or about the human body.” Some items are NOT exempt from sales tax, including: watches, jewelry, umbrellas, and sporting equipment (such as skis, roller blades, or swim fins).

Plan Ahead To Take Advantage of the Tax Holiday

First, plan to have funds available by saving between now and that weekend. Delay or cancel other unnecessary purchases so funds are available.

Second, carefully consider whether to make credit card purchases that weekend. If you pay credit card interest for several months on your purchases, that cost will offset your sales tax savings.

Finally, plan your purchase needs. Stores may be extra-busy that weekend, so be organized – know the sizes you need, and have a clear list of high-priority needs as well as lower-priority possibilities.