Marshmallows and hot chocolate have become such a commonplace combination that you can even buy hot chocolate that comes pre-mixed with marshmallows. But this combination, like a number of the other marshmallow-topped dishes Americans have come to enjoy, can be taxable.
According to The Indiana Department of Revenue, marshmallow crème is exempt from sales tax but marshmallows are not. Candy is taxable in Indiana and marshmallows are considered candy because they are a preparation of sweeteners and flavorings in the form of pieces.
So, next time you cozy up next to the fireplace to enjoy a nice cup of hot chocolate, consider using marshmallow crème instead of marshmallows to save yourself the tax money.
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