You can deduct sales tax on a new or used purchased or leased vehicle. To claim sales taxes on a vehicle or boat you need to meet two criteria.
- You must itemize deductions, and
- your sales tax deduction, including the sales tax on the vehicle must exceed your state income tax.
Realistically,in most states with a state income tax, the state income taxes would be higher than the sales taxes paid, even with sales tax on a car added.
If you claim the standard deduction, you cannot deduct sales taxes.
The deduction for sales tax is under the deductions and credits tab.
- Go to: Deductions and Credits
- Estimates and Other Taxes Paid
- Sales Tax.
- Click Update
- Select Sales Tax.
- Click Continue.
- Select Easy Guide.
- Click Edit next to your sales tax rate.
- Click Continue twice and you will then be on the page where you enter your car or other major purchases.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
