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how can i deduct sales taxes on food, clothing, medical supplies and motor vehicles?

 
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how can i deduct sales taxes on food, clothing, medical supplies and motor vehicles?

The sales tax deduction is done for you in the program if you select to deduct sales tax rather than state income tax.

 

To the base calculation you can only add major purchases, such as motor vehicles.

 

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rjs
Level 15
Level 15

how can i deduct sales taxes on food, clothing, medical supplies and motor vehicles?

The deduction for sales tax is an itemized deduction. It will not reduce your tax or increase your refund unless your total itemized deductions are more than your standard deduction. Also, you can deduct either sales tax or state and local income tax, but not both. TurboTax will calculate your deduction for sales tax based on the IRS tables. It will then give you either the sales tax deduction or the state income tax deduction, whichever is higher.


If you go through the sales tax EasyGuide section of the TurboTax interview, it will give you two options that might increase the calculated deduction. One option is to add the tax that you paid on certain "specified items." (TurboTax uses the term "major purchases, but that's misleading. You can only add the tax on "specified items" listed in the IRS rules.) The specified items are a motor vehicle, an aircraft, a boat, a home, or a substantial addition to or major renovation of a home. So that is where you could add the sales tax that you paid on a motor vehicle. The other option is to add any nontaxable income that you had to the amount of income that is used to calculate the sales tax deduction.


Instead of using the calculation based on the IRS tables, you have the option to enter the actual sales tax that you paid from the receipts for all of your purchases during the year. But you probably do not have all of your receipts showing the sales tax for food, clothing, and so on, so you're better off using the amount calculated from the IRS tables.


Finally, the total deduction for state and local taxes is limited to a maximum of $10,000 per year ($5,000 if you are married filing separately). The maximum applies to the total of real estate tax, personal property tax, and either state and local income tax or state and local sales tax. So if your other taxes already exceed the maximum, adding sales tax is not going to make any difference in your tax or your refund.

 

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