In New York State, not all purchases are subject to sales or use tax. Certain goods and services are exempt from taxation, allowing consumers and businesses to save money. Knowing what items are tax-free helps you plan purchases effectively and ensures compliance with state tax laws.
Common Items You Can Buy Without Tax
1. Groceries
Most food and beverages intended for home consumption are exempt from sales tax. Examples include:
- Fruits and vegetables
- Bread and cereals
- Dairy products
- Meat and poultry
2. Prescription Medications
Prescription drugs are generally non-taxable in New York. Some over-the-counter medications may also qualify for exemption depending on their medical purpose.
3. Clothing and Footwear
Clothing and footwear priced under $110 per item are exempt from sales tax. This exemption applies to most everyday apparel and shoes, but luxury items over the price threshold may still be taxable.
4. Medical Equipment
Certain durable medical equipment and devices used for medical purposes may be exempt, particularly when purchased by patients or healthcare providers.
5. Purchases by Tax-Exempt Organizations
Nonprofits, government agencies, and other qualified tax-exempt entities can purchase goods without paying sales tax, provided they use a valid exemption certificate.
6. Items for Resale
Businesses that purchase goods to resell to customers can buy items tax-free by using a resale certificate. This prevents double taxation on the same product.
Special Tax-Free Opportunities
New York occasionally offers sales tax holidays, allowing temporary tax-free purchases on items such as school supplies, clothing, and footwear during specific periods. Consumers can save additional money by taking advantage of these events.
Why It Matters
Knowing what you can buy without paying tax helps you budget smarter and ensures that you do not overpay. For businesses, understanding tax exemptions is crucial for accurate bookkeeping and compliance. Misclassifying taxable and non-taxable items can result in penalties or audits by the New York State Department of Taxation and Finance.
Want to make sure you’re buying tax-free items correctly? Contact Dimov NYC CPA for expert guidance on New York sales and use tax compliance.
