The IRS.gov website says you cant deduct vehicle excise tax for personal use. Why is TurboTax telling me to deduct for personal use?

Forum|Forum|2 years ago
January 29, 2024
4 replies
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TurboTax Deluxe Online

xmasbaby0

Level 15

Where do you think TT is telling you that?

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

sbutts10Author

Level 2

It’s says right here on turbo tax. (Picture attached).

xmasbaby0

Level 15

Take a closer look at your own screenshot. It tells you that you can enter excise tax in the state of Indiana.

Opus 17

Level 15

I don't know what you mean by excise tax.

If you pay general sales tax when buying a new or used vehicle (either separately or as part of a registration fee) you can include that as a deduction if you are deducting state sales tax instead of state income tax. The sales tax must be the same as charged on general consumer goods in your state, city or county.

If you pay a personal property tax based on the value of your vehicle (more common in the South) you can deduct that in addition to deducting state and local income tax or sales tax. A personal property tax is assessed on the value of the car. For example, your county might charge $2 per $1,000 of value. If the Blue Book value of the car is $15,000, your tax would be $300. Next year, the car is older and worth less, so the book value and the tax go down a little bit.

In some states, the price to register the car with the DMV each year includes a fee based on the value of the car. This fee is deductible as a personal property tax, but not the whole cost to register the car, just the cost based on the car's value.

I'm not aware of other car taxes being deductible for personal use vehicles.