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Level 1
June 6, 2019
Solved

Can I deduct the amount paid for new car tax, title, and license in Texas? If so, would that be entered in the personal property taxes section?

  • June 6, 2019
  • 1 reply
  • 5 views
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Best answer by Hal_Al

No. But you may deduct the sales tax you paid.

You are allowed to deduct state & local income taxes OR sales tax; but not both. This provision was added primarily to allow a deduction for people in states without income tax (like TX). Sometimes, with a big purchase (like a car), you may be better off deducting sales tax even if your state has an income tax. If you don't have all your receipts (and hardly anybody does), you are allowed to use tables (built into TT from IRS Pub 600) based on income & exemptions, You can then add major purchase sales tax to the table amounts. Neither is deductible if you use the standard deduction instead of itemizing.

In TurboTax, enter at:

Federal Taxes Tab (Personal for H&B version)

Deductions & Credits

-I'll choose what I work on

-Scroll down to:

--Estimates & other taxes paid

   -Sales tax

1 reply

Hal_Al
Level 15
Hal_AlLevel 15Answer
Level 15
June 6, 2019

No. But you may deduct the sales tax you paid.

You are allowed to deduct state & local income taxes OR sales tax; but not both. This provision was added primarily to allow a deduction for people in states without income tax (like TX). Sometimes, with a big purchase (like a car), you may be better off deducting sales tax even if your state has an income tax. If you don't have all your receipts (and hardly anybody does), you are allowed to use tables (built into TT from IRS Pub 600) based on income & exemptions, You can then add major purchase sales tax to the table amounts. Neither is deductible if you use the standard deduction instead of itemizing.

In TurboTax, enter at:

Federal Taxes Tab (Personal for H&B version)

Deductions & Credits

-I'll choose what I work on

-Scroll down to:

--Estimates & other taxes paid

   -Sales tax

Level 2
June 6, 2019
What about in Washington state?