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Sales Taxes Deduction

Can I deduct sales tax I paid from my taxes?

General sales taxes can be deducted on your tax return as follows. You can elect to deduct:

  • state and local general sales taxes instead of
  • state and local income taxes.

However, you cannot deduct both state and local general sales taxes and income taxes.

How much sales tax deduction can I claim?

To figure your sales tax deduction you can use either of the following methods:

Method 1: Actual state and local general sales taxes

The actual state and local general sales taxes (including compensating use taxes) you paid in the tax year if the tax rate was the same as the general sales tax rate. Sales taxes on food, clothing, medical supplies, and motor vehicles are tax deductible as a general sales tax even if the tax rate was less than the general sales tax rate.

Are sales taxes on motor vehicles tax deductible?

Sales taxes on motor vehicles are also tax deductible as general sales tax if the tax rate was more than the general sales tax rate, but the tax is deductible only up to the amount of tax that would have been imposed at the general sales tax rate.

Motor vehicles include:

  • cars
  • motorcycles,
  • motor homes
  • recreational vehicles
  • SUVs
  • trucks
  • vans
  • off road vehicles

Also include any state and local general sales taxes paid for a leased motor vehicle. You must keep your actual receipts showing general sales taxes paid if you use this method.

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