Ohio’s 2025 Sales Tax Holiday: What Businesses Need to Know

Sue Schloemer

Jun 20, 2025

Ohio’s sales tax holiday is changing this year; it runs for a full two weeks, from 12:00 a.m. on Friday, August 1, 2025, through 11:59 p.m. on Thursday, August 14, 2025. This expanded window presents both an opportunity and a responsibility for retailers.

If your business sells eligible items, now is the time to prepare. From training your team to updating your point-of-sale system, here’s what you need to do to stay compliant and maximize the benefits of the tax holiday.

Eligible Goods: Most tangible personal property priced at $500 or less per item is exempt from Ohio sales tax during the sales tax holiday. Examples of qualifying items include: clothing, electronics, appliances, home goods, sporting gear, personal care items, school and office supplies, soft drinks, and dine-in food.

Sales Tax Exemptions Do Not Apply To

Items priced over $500
Motor vehicles and certain watercraft
Alcoholic beverages, tobacco, vapor products, items containing marijuana
Services (except certain separately stated repair or installation services)

Why This Matters for Your Business

Participation is mandatory: All sellers of qualifying goods must comply – no opt-out is allowed
$500 per-item rule: Each item’s selling price determines exemption eligibility. Any item sold for more than $500 is fully taxable
Bundled or mixed transactions: Items bundled as a single non-itemized sale are fully taxable. Exemptions apply only if qualifying items are separately listed on receipts
Items sold as a unit: Items typically sold as a single unit (e.g., a pair of skis) cannot be split to meet the $500 threshold

Key Operational Steps

Update POS and e‑commerce systems
- Ensure systems apply item-level sales tax rules by August 1
- Program shipping charges to be prorated for orders with mixed taxability
Staff training
- Educate on qualifying items, mixed transactions, refunds, and proper receipt formatting
Inventory and pricing review
- Audit SKUs for applicability and clearly label eligible items
- Anticipate higher demand and adjust stock levels accordingly
E‑commerce timing
- Confirm online orders are placed and paid within the sales tax holiday window—delivery can occur later
Reporting and documentation
- Report exempt sales separately on your August sale and use tax return

Opportunities for Your Business

Marketing boost: Promote the tax-free savings to attract customers
Drive volume: The sales tax exemption also applies to business-to-business purchases —use this to your advantage

Action Plan (Now Through August 1)

Complete system reviews, inventory checks, and staff briefings
Run test transactions (in-store & online) to confirm correct pricing and receipt formatting
Launch customer promotions (“Tax-free savings start August 1st!”) and reinforce staff readiness

Need Help?

Our team is monitoring state guidance and is ready to support your planning and compliance needs. You can also reference the latest from the state:

With pre‑holiday readiness, you can turn compliance into opportunity—boosting customer goodwill and potentially increasing revenue during the tax holiday.

Schedule an appointment to learn how we can support you

More Resources

Guide: Next Level Accounting Services for Your Growing Business

Guide: Build a Better Business by the Numbers

Case Study: Strategic Accounting Support from Acquisition to Sale

About The Author

Sue enjoys helping clients succeed. Her breadth and depth of accounting knowledge combined with over 25 years of…

sschloemer@kirschcpa.com

Sign Up for Email Updates

Accounting & Financial News

Massive Budget Law Includes Numerous Business Tax Provisions

The new One, Big, Beautiful Bill Act (OBBBA) is packed with tax provisions that will affect U.S.…

Kirsch CPA Group Named to List of Greater Cincinnati’s Best Places to Work

There are great places to work and then there are best places to work.

At Kirsch CPA Group, we are…

9 Key Tax Law Changes for Individuals under the OBBBA

For the first half of 2025, individual taxpayers faced an uncertain tax situation because many provisions of the Tax Cuts…

Frequently Asked Questions

How can I manage cash flow better?

Good cash flow management and forecasting are essential for maintaining the financial health of your business. Having a rolling 12-month forecast of revenues and expenses helps you proactively avoid shortfalls and capitalize on opportunities. Learn more >

How can my business benefit from outsourced CFO services?

Outsourced CFO services, also known as fractional or virtual CFO services, let small and mid-size businesses leverage the deep financial expertise and strategic insights needed to accelerate growth and profitability for a fraction of the cost of hiring a full-time CFO. Key offerings include profitability analysis, cash flow forecasting, KPI benchmarking, and budgeting. Learn more >

How can I ensure that I don’t pay more taxes than necessary?

Effective tax planning involves leveraging all available tax credits, avoiding unpleasant surprises, keeping up with changes in the law, and ensuring you pay only your fair share. Learn more >

How can a CPA firm increase the profitability and value of my business?

When you partner with an accounting firm that offers advisory services, you will have the clear financial visibility needed to confidently make big decisions and drive profitable growth for your business. Learn more >

What should I look for in an outsourced accounting firm?

Growing a business requires more than tax preparation and basic accounting services. You need a holistic and forward-looking approach to your financial health. For best results, look for a partner who employs a proven process and a diverse range of services tailored to optimize cash flow, increase profitability, and maximize the value of your business. Learn more >

Recent Posts