If you live in Massachusetts and are in the market for a new Mac then you’re in luck. Massachusetts will once again be holding a tax holiday on the weekend of August 11-12. This might be a great opportunity to save some money on Apple products. Here’s what you need to know.
The broad sweeping Massachusetts tax holiday will apply to all (1) tangible personal property (2) whose individual purchase price totals less than $2,500, (3) provided the items are purchased for personal use. There are some items that are specifically excluded from tax-free treatment (i.e. automobiles, fuel, etc.), but those exclusions do not appear to apply to anything Apple sells at the moment. In short, almost anything you can buy from Apple will be tax-free.
There are two basic questions you need to ask yourself while you’re shopping. First, are you buying for personal or for business use? If you’re buying for business use, then you’re still legally obligated to pay the full 6.25% tax rate – sorry. Second, does each individual item in your purchase cost $2,500 or less? Some of the more expensive Macs exceed the $2,500 limit (higher-end MacBook Pro with Retina display starts at $2,799) and will not be eligible.
Spend More, Save More.
The $2,500 cap is a per-item limit – it’s not a limit on how much you can spend. For example, if you were to purchase a new entry-level MacBook Pro with Retina display for $2,199 and a Mac Mini for $599 your entire purchase is still tax-free because each individual item costs less than $2,500. There’s no need to make separate purchases or to request separate receipts or invoices. In the case of the above example you would save about $137 on the MacBook Pro and about $37 on the Mac Mini.
Don’t forget to also consider loading up on extra gear or peripherals. Although the tax holiday does impose the same $2,500 limit on “bundled items” – multiple items offered for sale at a single price – there’s nothing stopping you from throwing in extras on your own accord.
It may also be a good idea to consider customizing your Mac. Buying a configuration with a faster processor, more RAM, or a larger hard drive, etc. may be more financially feasible given the extra savings you will enjoy. The tax holiday imposes no limitations on special orders (i.e. custom configuration) nor does it require that you actually take possession of the item during the holiday period. It’s sufficient that you place the order and pay for it during the holiday weekend.
Student Discounts And More.
If you’re eligible for any of Apple’s discount programs (i.e. student or education discounts) then don’t forget to take advantage of them too. There’s nothing to prevent you from using them during the tax-free holiday. Not only will save more money, but the extra savings may be determinative when making the $2,500 or less per item eligibility calculation. The $2,500 or less limitation is calculated after any manufacturer discounts or coupons are applied. Using a student discount or other coupon might be enough to bring the price of an item to just below $2,500 and, therefore, make it eligible for tax-free treatment.
If you are a student then make sure you also take advantage of Apple’s back to school promotion, which is now underway. You get a $100 iTunes gift card along with any current generation Mac (except the Mac Mini) purchase and a $50 iTunes gift card along with any iPad purchase.
What Not To Buy?
Exercise some restraint and don’t forget about Apple’s own product release schedule. You probably don’t want to buy a Mac that will be out of date within a month or two. Check out Cult of Mac’s When to Buy Your Apple Product page to get a sense of where each Apple product lies in its life-cycle. Given the recent updates made to the MacBook lines and the approaching start of the new school year it’s likely that MacBook Airs and MacBook Pros will be in the highest demand.
Where To Buy?
There are currently ten official Apple Stores throughout Massachusetts and plenty other locations that sell Apple products, but don’t worry if you can’t get to one over the weekend. As mentioned above, you don’t have to take possession of the items during the tax holiday period. You will get the tax-free treatment provided you (1) place the order and (2) pay for the order during the tax-free holiday weekend. If you can’t make it out to a store or just want to avoid the crowds you can do all of your shopping online.
More Helpful Information.
As a quick aside, some may be wondering why not go to a state with a lower sales tax rate? For example, New Hampshire doesn’t impose any broad sales tax. Why not skip the Massachusetts sales tax holiday and buy a Mac in New Hampshire on any other day of the year? That’s because Massachusetts imposes what’s known as a use tax on untaxed items purchased outside of Massachusetts that are used or consumed within Massachusetts. Many other states have similar use tax rules. For example, if a Massachusetts resident were to purchase a Mac in New Hampshire for use in Massachusetts they would still technically be obligated to pay Massachusetts a use tax in the amount of 6.25% of the original purchase price. In such a scenario it’s typically up to the resident to report the purchase.
Massachusetts isn’t the only state that regularly holds a tax holiday, but given its sweeping applicability (all tangible personal property) and high price limit ($2,500) it’s one of the best with regards to saving on Apple products. It’s looking as if the 2012 tax holiday will be largely the same as the 2011 tax holiday. For more information here’s the Massachusetts Department of Revenue’s page on the 2011 tax holiday. Follow this link for more information about other state tax holidays. Many of these tax holidays occur during the summer months, so make sure you don’t miss one.
Have you taken advantage of the Massachusetts or other state tax holiday for your Apple purchases in the past? Do you plan on buying a Mac during this year’s Massachusetts tax holiday? Do you have any additional tips to offer? We would love to hear what you think in the comments.