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I don't understand the ad valorem tax or where to find it, I also don't understand which part of my cars registration fees are deductible. I also purchased one last year.

 
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2 Replies
ColeenD3
Expert Alumni

I don't understand the ad valorem tax or where to find it, I also don't understand which part of my cars registration fees are deductible. I also purchased one last year.

To get the deduction, enter it under car registration fees by doing the following:

  1. Log in to your account in TurboTax online program 
  2. Select Take me to my return
  3. At the right upper corner, type in car registration fees and Enter
  4. Select Jump to car registration fees
  5. On screen, Did you pay any car registration fees in 2021? Answer Yes  
  6. Enter your vehicle information 

Please see this additional information.

 

Yes, if it’s a yearly fee based on the value of your vehicle and you itemize your deductions.

You can’t deduct the total amount you paid, only the portion of the fee that’s based on your vehicle’s value.

And, not all states have value-based registration fees. The states that do are listed below along with the deductible portion of your registration fee.

 

 

States with deductible car registration fees and which portion you're allowed to claim

 

States where you claim personal property tax in lieu of vehicle registration fees

 

Where you can find your car registration fees:

 

 

 

I don't understand the ad valorem tax or where to find it, I also don't understand which part of my cars registration fees are deductible. I also purchased one last year.

Ad valorem means “based on the value of.“ It is a tax based on the value of the property, and is separate from any fee required to get a title or to be registered with the state or to get an inspection or prove you have insurance or anything else required when you register a car.

 

Most states charge sales tax on the purchase of a car. That is deductible as sales tax if you deduct sales tax. (You can deduct state sales tax or state income tax but not both.)

 

Some states charge a personal property tax based on the value of the car. For example, in the state of Virginia, the county tax assessor sends me a yearly bill for personal property tax based on the value of my car. If you look at the itemized bill, there is a $40 fee that everyone pays per vehicle and there is a variable fee based on the value of the car. The variable part of the fee, which is ad valorem, is a deductible personal property tax.

 

And in some states, the registration fee has a portion that is ad valorem, instead of or in addition to a separate personal property tax.  If you live in a state that has an ad valorem registration fee, you can deduct that portion of the registration fee — you do not deduct the entire registration fee, only the variable portion that is based on the value of your vehicle.  For a list of states where this is allowed, see the information linked to by the other expert. To determine what portion of your registration fee is ad valorem, you need to look at your detailed receipt or contact your DMV.

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