Get Prepared! Feb 26-28: Alabama Severe Weather Sales Tax Holiday

Alabama will be holding its fifth annual Severe Weather Preparedness Sales Tax Holiday at the end of this month, offering tax exemptions on qualifying items purchased between 12:01am (CST) on Friday, February 26, 2016 and midnight on Sunday February 28, 2016. During this time, purchases of items such as batteries, radios, flashlights, ropes, duct tape, and first-aid kits are exempt from sales tax when they are sold for $60 or less per item. Additionally, portable generators and power cords used to provide light or communications or to preserve food in the event of a power outage would also qualify for the sales tax exemption if they cost $1,000 or less per item. Internet Sales Requirements For purchases of items that qualify for the exemption, an Alabama resident may also take advantage of the sales tax exemption when they are purchased through the Internet so long as (1) the item is paid for during the holiday and (2) the item is delivered to the resident during the exemption period. Alternatively, the resident may pre-order the item and schedule for it to arrive during the exemption period to qualify for the exemption. Local Taxing Jurisdictions’ Participation Counties and municipalities can “opt-in” to participate in the holiday and exempt the same qualifying items from county or municipal sales tax. The counties and municipalities that did not participate would be required to charge county and municipal sales tax for transactions taking place within those locations. In order to “opt-in,” the counties and municipalities must adopt the Sales Tax Holiday through a resolution or an ordinance, at least 30 days prior to the start of the holiday, which takes place during the last full weekend in February. However, there is no deadline by which the counties or municipalities must notify the DOR. As such, it is possible that the DOR receives notice of their participation less than 30 days prior to the start of the holiday. For example, this year, the full list of participants was not posted on the Alabama DOR’s website until February 9^th. Clearly, close monitoring of the DOR’s website and maintaining contact with the localities, particularly as we get closer to the Sales Tax Holiday, is important to ensure that every participating local has been accounted for. At Sovos, we are here to track these changes for you and keep you well-informed. We also update our solutions to account for these changes so your organization can maintain compliance.