Bought a car in Delaware, but live in Maryland. How do I deduct on taxes? Can't do sales tax because DE doesn't have sales tax.

[fanfare]

I think you answered your own question.

[allamericangirl8]

Well how do I enter it for a deduction?

[fanfare]

The only tax break for a car purchase is the sales tax, but you have no sales tax to report.

[allamericangirl8]

I paid a government tax? is that the same?

[re2boys]

If you paid a tax to MD when you went to register it in your home state and the tax was based on the purchase price of the car, that tax is deductible as an itemized deduction.

However, for that tax to be a benefit, your total sales tax paid that year would need to exceed the total of your state and local income taxes paid.  Then the total of all itemized deductions allowed would need to exceed the standard deduction allowed.

Hence, listing the sales tax on the vehicle may not benefit you at all but you don't know until you run the numbers.