How to Avoid Paying Sales Tax

Avoid Paying Sales Tax

How to Avoid Paying Sales Tax. There are many legal ways to avoid paying sales tax, most of which have to do with loopholes and little known laws. Whether you are buying a small item for your home or you are shopping for a car, there are ways to avoid taxes and save money without having to claim deductions at the end of the fiscal year and without the need for a tax exempt form.

Step 1

Shop online. A large number of Internet businesses do not charge sales tax. Even those that do usually only charge taxes to buyers who reside in the same state where the company is located. To avoid paying taxes at all, simply look for a company based in a different state or one that has an online only storefront.

Step 2

Drive or fly to a state that has no sales tax implemented on purchases of any kind. While it may not make sense to fly there just to buy a small item, keep the tax free concept in mind if you are ever there for vacation or if you live in a neighboring state and can afford to drive a few hours to get there.

Step 3

Avoid stores. Instead, shop at garage sales, state auctions and use newspaper classifieds as much as possible, especially for household items and everyday objects. Consider trading items you no longer need with other people in your church or community groups so you can both benefit without any exchange of money.

Step 4

Use Craigslist (see Resources below). Now considered the largest online "flea market" in the world, Craigslist is a great place to buy and sell everything from furniture to unused plane tickets. Because all business is conducted customer to customer, sales tax is never required.

Step 5

Shop during tax break time, such as "back to school" specials or free tax month (usually in January). Some of these specials do not cover all items, but even then, you may be able to save on certain products that you would have to buy anyway at a later time.

Tip

In certain states (such as Alaska, Delaware, Montana, New Hampshire and Oregon), you may be able to avoid taxes completely, as they do not charge sale tax on any items.

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