Vehicle registration deduction in IA

Determining the deductible amount of the vehicle registration fee requires a computation on your part. This is because only the part of the fee based on the value of the car is deductible for federal purposes.

Here are the instructions from the Iowa website:

"If you itemize deductions, a portion of the automobile or multipurpose vehicle annual registration fee you paid in 2014 may be deducted as personal property tax on your Iowa Schedule A, line 6, and federal Schedule A, line 8.

This deduction is for annual registration fees paid based on the value of qualifying automobiles and multipurpose vehicles. Multipurpose vehicles are defined as motor vehicles designed to carry not more than 10 people, and constructed either on a truck chassis or with special features for occasional off-road operation [Iowa Code section 321.1(44)]."

This is the computation (borrowed from the state's website).

• Get the actual annual registration fee paid.
• Take the weight of your automobile and divide it by 250. The weight is found on your automobile registration certificate.
• Subtract line 2 from line 1. This is the deductible amount for line 37.

Here is the example from the state website:

Malia purchased an automobile from Jennifer.
The actual fee Malia paid to register the automobile at the courthouse was $150.
The weight of the automobile is 3,000 pounds.
The deductible amount is calculated as follows:

Get the actual annual registration fee paid - $150
Take the weight of your automobile and divide it by 250. The weight is found on your automobile registration certificate - 12
Subtract line 2 from line 1. This is the deductible amount - $138

In short, this formula removes the amount of the fee that is based on weight, leaving only the amount based on value.