Can i claim vehicle sales tax

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If you changed your city or county of residence even within the same ZIP code , then enter your new residence separately in the calculator. The calculator will give the correct answer whether or not the two locations have different sales tax rates. But the calculator has local sales tax rate information. This is not contained in the paper instructions. It also does the math for you. Because it is in lieu of your having to add all of your general sales tax payments from your receipts, which you are always entitled to do.

If an average annual amount were included in the tables for these purchases, then taxpayers would be able to get double benefit for them: using their actual receipts in years when they purchased such items, but using the tables in all other years. As a result, the law provides for such items to be accounted for outside of the tables entirely.

There are two key features of a general sales tax: What is taxed the tax base , and how much it is taxed the tax rate. Among states that have local sales taxes, these two features create three basic categories:. The deduction for state and local general sales tax is meant to be the amount of sales tax you actually paid. Rather than require you to keep all of your receipts, the tax law allows you to use the optional sales tax tables provided by the IRS.

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The sales tax deduction gives taxpayers the opportunity to reduce their tax liability when they deduct state and local sales taxes or state and local income taxes that they paid in — but not both together. State and local real estate and personal property taxes can be deducted in addition to either the state income or sales tax deduction. The deduction for state and local income taxes has been around since federal taxes were first introduced in The state and local sales tax deduction came about nearly 30 years later, but the rules for taking this deduction have changed many times over the decades.

Previously no cap was imposed. The IRS allows you to deduct the actual sales taxes you paid, as long as the tax rate was no different than the general sales tax rate in your area.

Exceptions are made for food, clothing and medical supplies. Actual sales taxes on these items are deductible even if consumers paid less than the general sales tax rate on these items. If you paid sales taxes for big-ticket items, such as an engagement ring, wedding expenses, electronic equipment, furnishings for a new home, etc. In addition to the sales tax amounts provided in the table, taxpayers may add actual sales taxes paid for specific items.

For example, sales taxes paid for motor vehicles can be deducted up to the amount of the state and local sales tax rate, but not higher. Allowable sales tax deductions for motor vehicles and other large purchases include the following:. Taxes spent on leased vehicles can also be deducted. First, decide whether to take the standard deduction or whether to itemize deductions. Expenses that can be itemized include charitable contributions, personal casualty and theft losses from a federally declared disaster, mortgage interest, and medical and dental expenses that exceed certain thresholds.

If itemizing proves to be the better course of action, taxpayers then must choose between taking the state and local income tax deduction or the sales tax deduction.

People typically pay more in state income taxes than state and local sales taxes, but it pays to total both types of expenses and compare them to make sure.

There is a general sales tax deduction available if you itemize your deductions. You will have to choose between taking a deduction for sales tax or for your state and local income tax. You can deduct sales tax on a vehicle purchase, but only the state and local sales tax. The rate of sale tax you paid must be the same as the general sales tax rate, otherwise you can only deduct the general sales tax rate.