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Retirement tax questions
Yes, if you itemizing and you are using the actual sales tax method you can include the sales tax on your vacation. Anything you purchased that was a large purchase counts as a major purchase if you paid sales tax on it. It can be a luxury item, a practical item or anything in between.
If you are using the optional method then you cannot add the sales tax for major purchases unless they are specified on page 6 line 7 of the instructions., such as a boat, car, or home. The amount you can claim is based on the table using your income and location. Schedule A Instructions See page 12
In addition, you can only claim this if you are itemizing your return. This also replaces the State and Local Income tax deduction. You cannot claim both sales tax and income tax, it is either one or the other.
Itemized expenses include mortgage interest, gambling losses up to winnings, charitable contributions, state and local taxes up to $10,000, medical expenses in excess of 7.5% of your AGI and casualty and losses in excess of 10% of you AGI with the first $100 not counting towards the loss.
Then your total itemized expenses would need to be greater than your standard deduction below in order to benefit from your expenses.
The 2024 Standard Deductions are as follows:
- Married Filing Joint (MFJ) $29,200
- Married Filing Separate (MFS) $14,600
- Head of Household (HOH) $21,900
- Single $14,600
Blind or over 65 and MFJ or MFS add $1,550
Single or HOH if blind or over 65 add $1,950
Standard versus Itemized Deduction
(Edited 4/10/025 @ 11:37AM PST) @neilp11
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