As Mother’s Day approaches, let’s give some thought to all those parents out there who dutifully buy diapers for their wee ones. Despite the fact that diapers, disposable or otherwise, are an essential part of parenting, states have had a difficult time determining whether diapers should be taxable and even how to define diapers.
In fact, states often have complex rules regarding diapers. In Illinois, diapers are taxable at the general rate; many states, such as California, Iowa, Maine, Texas, and Wisconsin, also tax diapers. Other states, such as Massachusetts, New Jersey, New York, Vermont, and Minnesota exempt sales of diapers from sales and use taxes. Connecticut will also exempt diapers effective July 1, 2018. Also, eco-minded parents in Maryland, Minnesota, Wisconsin, and Pennsylvania should note that diaper services are not taxable in those states but are taxable in Texas.
The definitions of diapers also vary significantly across the states, showing the apparent difficulty of defining what I previously thought was a simple necessity. While Wisconsin doesn’t define “diaper,” generally it does define a “cloth diaper” as a “cloth diaper used for sanitary purposes.” Washington, D.C., defines a diaper as “an absorbent incontinence product that is washable or disposable and worn by a person, regardless of age or sex, who cannot control bladder or bowel movements.” In New Jersey, diapers are exempt as “disposable household paper products.”
Until recently, diapers were uniformly considered clothing under the Streamlined Sales and Use Tax Agreement, such that the 23 member states couldn’t exempt diapers without exempting all clothing items. On Oct. 11, 2017, the Streamlined Sales and Use Tax Governing Board provided states with the option to exclude diapers from the definition of clothing. In so doing, the Board defined diapers generally as “an absorbent garment worn by humans who are incapable of, or have difficulty, controlling their bladder or bowel movements,” while providing that states could tax adult and children’s diapers differently. The Board noted that it would have to eventually define the terms children’s diapers and adult diapers separately.
On May 3, 2018, after some internal discussion, the Streamlined Sales and Use Tax Governing Board decided on a somewhat circular definition of children’s diapers that means “diapers marketed to be worn by children.” “Adult diapers” means “diapers other than children’s diapers.”
Whether or how states define diapers, I know that I and many other mothers would certainly appreciate a sales tax exemption for Mother’s Day.
Continue the discussion on Bloomberg Tax’s State Tax Group on LinkedIn: How should states define and tax diapers? Should sales tax exemptions apply equally to children’s diapers and adult diapers?
Get a free trial to Bloomberg Tax: State, a comprehensive research service that provides deep analysis and time-saving practice tools to help practitioners make well-informed decisions.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)