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stefan-a-stefano
New Member

Bought used car in 2016 in Maryland from Darcars. Paid "Title Tax" on their bill - $1,500 to the state of MD and $186 as 2-year registration fee. Can I deduct this?

I have itemized deduction. Can I put the tax and 1 or 2 year reg fee under "Cars and other things you own" in TurboTax input menu?

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ChrisJ
New Member

Bought used car in 2016 in Maryland from Darcars. Paid "Title Tax" on their bill - $1,500 to the state of MD and $186 as 2-year registration fee. Can I deduct this?

You can elect to deduct state and local general sales taxes, instead of state and local income taxes, as an itemized deduction on Schedule A. You cannot deduct both.

So the answer is yes - title taxes are deductible as sales taxes, but you cannot claim both sales/local tax and income tax deductions. Generally speaking, income taxes will be more than sales or local taxes. Enter the information into TurboTax to compare:

Go to Search (top right), then type the exact phrase 'use tax' into Ask your question or search TurboTax. Jump to use tax.

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ChrisJ
New Member

Bought used car in 2016 in Maryland from Darcars. Paid "Title Tax" on their bill - $1,500 to the state of MD and $186 as 2-year registration fee. Can I deduct this?

You can elect to deduct state and local general sales taxes, instead of state and local income taxes, as an itemized deduction on Schedule A. You cannot deduct both.

So the answer is yes - title taxes are deductible as sales taxes, but you cannot claim both sales/local tax and income tax deductions. Generally speaking, income taxes will be more than sales or local taxes. Enter the information into TurboTax to compare:

Go to Search (top right), then type the exact phrase 'use tax' into Ask your question or search TurboTax. Jump to use tax.

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